Web 2.0 Weekly - 09-05-26
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Month-to-date financings in May totalled $106.6 million; led by the $20 ...

Month-to-date financings in May totalled $106.6 million; led by the $20
million One Net financing. So far, there have been 18 financings in May,
with 10 deals greater than $5 million and only five less than $5 million.
There have been two financings greater than $10 million (Cyberplex and One
Net), with the capital raises by Imeem and EveryZing close behind at $8.8
million and $8.3 million, respectively. The average value thus far in May is
$5.9 million, slightly below the average value for April of $6.5 million on
21 financings. The March average was $6.6 million on 24 financings. Except
for two deals (Kaixin001.com and Collective Media), all were below $20
million for the last three months and a total of four deals were greater
than or equal to $15 million.
*One Net’s $20 million financing is largest deal in May: *One Net announced
a $20 million financing last week, the largest deal so far in May. Ten of
the 18 deals in the month are equal to or greater than $5 million. For
additional details, see Figures 23 and 24 (at end of note). Also note that
the spin-off of StumbleUpon from E-bay on a $29 million valuation occurred
in May. E-bay had bought StumbleUpon for $75 million.



*A strong price performance week: *The companies in our universe had
relatively strong stock price performances over the past week (for stocks
with prices greater than $1) (Figure 6), with 31 companies showing positive
returns on the week. OpenWave Systems (NASDQ:OPWV) led the group with a
49.2% return, while DigitalTown (OTCBB:DGTW) had the worst return, dropping
35.0% in the week.

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Web 2.0 Weekly - 09-05-26 Document Transcript

  • 1. SOFTWARE & SERVICES 26 MAY 2009 DAVID SHORE, CFA, MBA 416.860.6784 WEB 2.O WEEKLY david.shore@researchcapital.com Arun Thomas (Associate) 416.860.7666 AVERAGE VALUATIO NS DRIFT LOWER A VE R AG E F I NA N CI NG D R OP S B EL O W $ 6 M M DE S P IT E $2 0 M M O N E N ET F IN AN CI NG Month-to-date financings in May totalled $106.6 million; led by the $20 million One Net financing. So far, there have been 18 financings in May, with 10 deals greater than $5 million and only five less than $5 million. There have been two financings greater than $10 million (Cyberplex and One Net), with the capital raises by Imeem and EveryZing close behind at $8.8 million and $8.3 million, respectively. The average value thus far in May is $5.9 million, slightly below the average value for April of $6.5 million on 21 financings. The March average was $6.6 million on 24 financings. Except for two deals (Kaixin001.com and Collective Media), all were below $20 million for the last three months and a total of four deals were greater than or equal to $15 million. Financing Activity Last Three Months 180.0 7.0 160.0 6.0 140.0 5.0 120.0 4.0 100.0 (US$m) (US$m) 80.0 3.0 60.0 2.0 40.0 1.0 20.0 0.0 0.0 Mar-09 Apr-09 May-09 Total Average One Net’s $20 million financing is largest deal in May: One Net announced a $20 million financing last week, the largest deal so far in May. Ten of the 18 deals in the month are equal to or greater than $5 million. For additional details, see Figures 23 and 24 (at end of note). Also note that the spin-off of StumbleUpon from E-bay on a $29 million valuation occurred in May. E-bay had bought StumbleUpon for $75 million. A strong price performance week: The companies in our universe had relatively strong stock price performances over the past week (for stocks with prices greater than $1) (Figure 6), with 31 companies showing positive returns on the week. OpenW ave Systems (NASDQ:OPW V) led the group with a 49.2% return, while DigitalTown (OTCBB:DGTW ) had the worst return, dropping 35.0% in the week. This report has been created b y Anal ysts that are emplo yed b y Research Capital Corporation, a Canadian Investment Dealer. For further disclosures, please see last page of this report. w w w . r e s e a rc h c a p i t a l . c o m T o ro n t o 4 1 6 . 8 6 0 . 7 6 0 0 Montreal 514.399.1500 Vancouver 604.662.1800 Calgary 403.265.7400 Regina 306.566.7550
  • 2. Page 2 THE WEB 2.0 UNIVERSE Ninety-three public Web 2.0 companies = $50 billion market cap: Our W eb 2.0 universe contains 93 companies, with a combined market cap of approximately $49.4 billion (Figure 1). The average market cap for the group is ~$530 million (but a median of only $53 million), with average trailing revenue of $152 million (median $54 million). The companies are also generally profitable, with a median EBITDA margin of 17%. On a valuation basis, the overall average is 5.4x trailing revenue (median 1.8x) and 9.3x trailing EBITDA (median 8.6x). Fourteen of the companies have more than 500 employees. C omparable C ompany Analys is > Web 2.0 Trading C urrent US D Market US D L TM Total US D L TM Total E B ITDA TE V/L TM TE V/L TM C ompany Name L TM as of Tic ker E xchange C urrency HQ Pric e C ap ($m) R ev ($m) E B ITDA ($m) % R evenue E B ITDA E mployees Accelerize New Media, Inc. 3/31/2009 AC LZ OT C BB US D U nited S tates 0.52 14.4 4.1 (4. 4) NM 4. 7x - 11 Actoz S oft C o., L td. 12/31/2008 A052790 K OS E KRW S outh K orea 21, 750 149.0 74.9 14.9 20.0% 1. 6x 8. 1x NA AQ Interactive, Inc. 12/31/2008 3838 TS E JPY J a pa n 67, 000.00 38.4 63.5 5. 1 8. 0% 0. 1x 1. 6x NA As s ocia ted Media Holdings Inc. 6/30/2007 AS MH OT C P K US D U nited S tates 0 0.1 0.1 (2. 3) NM 8. 1x - 3 B igs tring C orp. 12/31/2008 BS GC OT C BB US D U nited S tates 0.02 1.2 0.1 (2. 1) NM 31.7x - 4 B etawa ve C orpora tion 3/31/2009 B W AV OT C BB US D U nited S tates 0 2.6 8.4 (12.6) NM - - 53 B eyond C ommerce, Inc. 3/31/2009 B YOC OT C BB US D U nited S tates 1.15 51.0 7.1 (9. 5) NM 7. 8x - 43 B right T hings plc 9/30/2008 AIM:B G T AIM GBP U nited K ingdom 0 4.7 0.3 (1. 8) NM 17.6x - 9 B roadW ebAs ia Inc. 9/30/2008 BWBA OT C P K US D U nited S tates 0.30 25.3 0.0 (4. 6) NM - - 46 C DC C orp. 3/31/2009 C HIN.A Nas da qG S US D Hong K ong 1 151.7 389.9 30.8 7. 9% 0. 4x 5. 4x NA C ha ngyou.com L imited 3/31/2009 C YOU Nas da qG S US D C hina 29.01 1,595. 6 222.5 135.1 60.7% 6. 3x 10.4x 628 C hina G ateway C orporation 9/30/2008 CGWY OT C P K US D U nited S tates 0 0.0 6.7 (6. 6) -98. 9% 0. 0x - 37 C hines e G a mer Interna tional 3/31/2009 G T S M:3083 GTS M TWD T aiwan 378.00 974.9 56.6 31.7 56.0% 16.0x 28.6x NA C ornerW orld C orpora tion 1/31/2009 CWR L OT C BB US D U nited S tates 0 5.8 1.3 NM NM 5. 5x - NA C yberplex Inc. 3/31/2009 T S X :C X TS X C AD C ana da 1.74 82.9 72.5 7. 5 10.3% 1. 1x 10.5x NA DADA S pA 9/30/2008 C M:DA CM E UR Italy 6 134.5 237.4 37.9 16.0% 0. 8x 4. 9x NA DX N Holdings B hd 2/28/2009 DX N K LS E MY R Malays ia 0.41 26.8 79.3 10.9 13.7% 0. 5x 3. 9x NA Dibz International, Inc. NA DIB Z OT C P K US D U nited S tates 0 0.0 NA NM NM - - NA Digita lP os t Interactive, Inc. 12/31/2008 DG LP OT C BB US D U nited S tates 0.02 1.4 0.5 (3. 2) NM 5. 6x - 7 Digita lT own, Inc. 2/28/2009 DG T W OT C BB US D U nited S tates 1 35.2 NM (3. 0) NM - - 3 Dolphin Digital Media, Inc. 3/31/2009 DP DM OT C BB US D U nited S tates 0.68 35.1 0.8 (3. 7) NM 46.8x - NA E olith C o. Ltd. 12/31/2008 A041060 K OS E KRW S outh K orea 840 48.6 14.8 (3. 5) -23. 6% 3. 4x - NA E xtens ions , Inc. 12/31/2008 E XT I OT C P K US D U nited S tates 0.15 14.2 NM NM NM - - 2 F ina ncial Media G roup, Inc. 2/28/2009 F NG P OT C BB US D U nited S tates 0 0.3 7.2 2. 4 34.1% - - 22 F luid Mus ic C anada, Inc. 12/31/2008 T S X :F MN TS X C AD U nited S tates 0.75 35.0 4.6 (9. 3) NM 5. 3x - NA F rogs ter Interactive P ictures AG 6/30/2008 FRG XT R A E UR G erma ny 8 26.2 5.6 (3. 4) -60. 6% 4. 6x - NA G amania Digita l E ntertainment C o., L td. 3/31/2009 6180 GTS M TWD T aiwan 52.80 245.8 127.1 21.1 16.6% 1. 8x 10.5x NA G ameO n C o Ltd. 12/31/2008 3812 TS E JPY J a pa n 96, 700 98.5 78.6 20.3 25.9% 0. 5x 2. 0x NA G eoS entric O yj 12/31/2008 G E O 1V HLS E E UR F inla nd 0.05 62.7 6.1 (13.8) NM 8. 9x - 94 G ia nt Intera ctive G roup, Inc. 12/31/2008 GA NY S E US D C hina 8 1,866. 8 233.6 144.6 61.9% - - NA G igaMedia Ltd. 12/31/2008 G IG M Nas da qG S US D T aiwan 5.95 321.5 190.4 46.0 24.2% 1. 3x 5. 3x NA G ravity C o., Ltd 9/30/2008 GR VY Nas da qG M US D S outh K orea 1 32.8 39.3 7. 5 19.2% - - 636 G ree, Inc. 6/30/2008 T S E :3632 TS E JPY J a pa n 5, 300.00 1,247. 3 31.0 11.1 36.0% 37.6x - NA G ungHo Online E ntertainment, Inc. 12/31/2008 3765 OS E JPY J a pa n 155, 000 187.1 118.5 21.1 17.8% 1. 4x 7. 8x NA HanbitS oft, Inc. 12/31/2008 A047080 K OS E KRW S outh K orea 5, 520.00 97.1 55.8 (15.7) -28. 2% 1. 4x - NA IAC /InterActiveC orp. 3/31/2009 IAC I Nas da qG S US D U nited S tates 15 2,334. 7 1,406.4 42.6 3. 0% 0. 3x 10.5x 3, 200 IAS E nergy, Inc. 1/31/2009 IAS C . A OT C BB US D C ana da 0.26 18.2 0.0 (0. 8) NM - - NA is eemedia Inc. 12/31/2008 IE E T S XV C AD C ana da 0 4.1 1.3 (5. 3) NM 1. 8x - NA J umbuck E nterta inment P ty Ltd. 12/31/2008 AS X :J MB AS X AU D Aus tralia 0.41 15.9 14.0 5. 2 37.2% 0. 8x 2. 1x 72 J umpT V Inc. 12/31/2008 T S X :J T V TS X C AD C ana da 1 80.9 13.4 (8. 4) -62. 6% 4. 7x - 237 K a boos e Inc. 3/31/2009 T S X :K AB TS X C AD C ana da 0.61 75.9 73.2 8. 7 11.9% 1. 1x 9. 3x NA K ings oft C o. L td. 12/31/2008 3888 S E HK HK D C hina 6 783.0 120.3 46.6 38.7% 6. 2x 15.9x 2, 271 L ingo Media C orporation 12/31/2008 T S X V :LM T S XV C AD C ana da 1.05 12.0 0.9 (1. 5) NM 11.6x - NA L iveW orld Inc. 12/31/2008 LV W D OT C P K US D U nited S tates 0 2.2 11.8 (0. 5) -4.3% 0. 1x - NA L ook S mart, Ltd. 3/31/2009 L OO K Nas da qG M US D U nited S tates 1.28 21.9 60.7 (3. 8) -6.3% - - 90 Ma gnitude Information S ys tems Inc. 12/31/2008 MAG Y OT C BB US D U nited S tates 0 4.6 0.1 (3. 0) NM - - 14 Mixi, Inc. 3/31/2009 2121 TS E JPY J a pa n 470, 000.00 761.4 127.0 45.0 35.4% 5. 1x 14.3x NA Modern T imes G roup Mtg AB 3/31/2009 MT G B OM SEK S weden 221 1,938. 6 1,796.0 275.1 15.3% 1. 4x 9. 1x 2, 969 Moggle, Inc 3/31/2009 MMO G OT C BB US D U nited S tates 2.30 83.5 NM NM NM - - 3 MO K O .mobi L imited 12/31/2008 MK B AS X AU D Aus tralia 0 4.1 1.1 (2. 3) NM 2. 6x - NA Myriad G roup AG 12/31/2008 MY R N SWX C HF S witzerla nd 6.00 118.0 40.0 0. 8 1. 9% 3. 3x - 405 NE O W IZ G a mes C orporation 12/31/2008 A095660 K OS E KRW S outh K orea 77, 500 598.5 198.7 53.3 26.8% 3. 0x 11.0x NA NetDragon W ebS oft, Inc. 3/31/2009 777 S E HK HK D C hina 5.45 371.6 87.1 34.4 39.5% 2. 7x 6. 8x 2, 426 Netea s e. com Inc. 3/31/2009 NT E S Nas da qG S US D C hina 33 4,030. 0 471.1 306.2 65.0% - - NA NeX plore C orpora tion 9/30/2007 NX P C OT C P K US D U nited S tates 0.70 39.0 NM (4. 9) NM - - 19 Ngi G roup Inc. 12/31/2008 2497 TS E JPY J a pa n 34, 000 44.3 103.6 31.9 30.8% - - NA Northgate T echnologies Limited 12/31/2008 590057 BSE INR India 37.00 27.3 142.5 25.1 17.6% 0. 2x 1. 1x 286 O pen T ext C orp. 3/31/2009 OT E X Nas da qG S US D C ana da 32 1,657. 6 782.6 199.2 25.5% 2. 2x 8. 7x 3, 400 O penwa ve S ys tems Inc. 3/31/2009 OP W V Nas da qG S US D U nited S tates 1.79 149.1 197.2 (2. 1) -1.0% 0. 2x - 630 P erfect W orld C o., Ltd. 3/31/2009 PWRD Nas da qG S US D C hina 19 1,020. 3 228.4 124.7 54.6% - - NA P hotoC hannel Networks Inc. 3/31/2009 T S X V :P N T S XV C AD C ana da 1.71 52.0 19.3 0. 5 2. 3% 2. 6x - NA Q uepa s a C orp. 3/31/2009 QP S A Nas da qC M US D U nited S tates 1 12.2 0.1 (10.8) NM - - 74 O AO R B C Information S ys tems 12/31/2007 R BCI R TS US D R us s ia 1.25 173.4 152.8 20.0 13.1% 0. 0x 0. 3x NA S handa Intera ctive E ntertainment Ltd. 12/31/2008 S NDA Nas da qG S US D C hina 55 3,811. 2 522.8 240.2 46.0% 0. 3x 0. 6x NA S hutterfly, Inc. 3/31/2009 S FLY Nas da qG S US D U nited S tates 14.29 359.7 215.2 28.3 13.2% 1. 4x 10.4x 514 S K C ommunications C o. , Ltd. 12/31/2008 A066270 K OS E KRW S outh K orea 10, 200 336.5 184.7 12.0 6. 5% 1. 8x 28.0x NA S NAP Interactive, Inc. 3/31/2009 S TVI OT C BB US D U nited S tates 0.75 8.1 3.3 0. 9 28.0% 2. 0x 7. 2x 11 S NM G lobal Holdings 9/30/2008 S NMN OT C P K US D U nited S tates 0 0.0 2.0 (0. 7) -34. 8% 1. 1x - 33 S ocia l Media V enures , Inc. 12/31/2008 S MV I OT C P K US D U nited S tates 0.01 0.0 0.1 (0. 1) -60. 5% 0. 0x - NA S ocia lwis e, Inc. 3/31/2009 S C LW OT C BB US D U nited S tates 1 32.1 0.0 (4. 8) NM - - NA S ohu. com Inc. 3/31/2009 S O HU Nas da qG S US D C hina 54.24 2,075. 4 460.0 200.5 43.6% 3. 7x 8. 5x 3, 197 S ites earch C orporation 1/31/2009 S TPC OT C BB US D U nited S tates 3 28.2 NM (1. 1) NM - - 15 S park Networks , Inc. 3/31/2009 L OV AME X US D U nited S tates 2.25 46.3 54.3 11.8 21.7% 0. 9x 4. 0x 183 S pectrumDNA, Inc. 3/31/2009 S P XA OT C BB US D U nited S tates 0 19.5 0.1 (2. 6) NM - - 7 T encent Holdings Ltd. 3/31/2009 700 S E HK HK D C hina 78.25 18,192.6 1,205.0 577.4 47.9% 16.4x 34.1x 6, 194 T he P a rent C ompany 8/2/2008 K IDS . Q OT C P K US D U nited S tates 0 0.2 112.0 (13.5) -12. 0% 0. 2x - 347 T he9 Limited 12/31/2008 NC T Y Nas da qG S US D C hina 8.97 240.6 250.2 84.3 33.7% - - NA T heS treet. com, Inc. 3/31/2009 TS CM Nas da qG M US D U nited S tates 2 58.2 67.0 1. 9 2. 9% - - 310 T otal S port O nline AS 3/31/2006 T OS O O T C NO NO K Norwa y 0.03 0.1 2.1 (1. 1) -50. 6% 4. 6x - 16 T ree.C om, Inc. 3/31/2009 TR E E Nas da qG M US D U nited S tates 12 131.7 215.6 (13.3) -6.2% 0. 6x - 700 U nis erve C ommunica tions C orp. 2/28/2009 T S X V :U S S T S XV C AD C ana da 0.05 1.1 23.2 0. 1 0. 2% 0. 2x - NA U nited O nline Inc. 3/31/2009 U NT D Nas da qG S US D U nited S tates 7 548.3 811.2 177.3 21.9% 1. 0x 4. 7x 1, 469 U O MO Media, Inc 1/31/2009 U O MO OT C BB US D C ana da 0.33 28.3 0.6 (0. 5) -78. 2% 45.0x - NA V a lueC lick Inc. 3/31/2009 V C LK Nas da qG S US D U nited S tates 10 872.3 591.7 105.5 17.8% 1. 3x 7. 3x 1, 189 V O IS , Inc. 12/31/2008 V O IS OT C BB US D U nited S tates 0.90 7.5 0.0 (1. 3) NM - - 4 W ebzen Inc. 3/31/2009 W ZE N Nas da qG M US D S outh K orea 5 53.8 23.1 (0. 4) -1.9% - - 314 W izza rd S oftwa re C orporation 12/31/2008 W ZE AME X US D U nited S tates 0.57 27.2 6.1 (6. 0) -98. 2% 4. 5x - 110 W orlds .com Inc. 12/31/2008 W DDD OT C BB US D U nited S tates 0 7.9 0.1 (0. 7) NM - - 1 W ynds torm C orpora tion NA W Y ND OT C BB US D U nited S tates 0.51 9.2 NA NM NM - - NA X ING AG 3/31/2009 O 1B C XT R A E UR G erma ny 33 240.4 53.0 16.5 31.2% 3. 6x 11.4x 239 Y eda ngOnline C orp. 12/31/2007 A052770 K OS E KRW S outh K orea 10, 800.00 136.0 55.0 12.3 22.4% 2. 5x 11.0x NA Y nk K orea Inc. 12/31/2007 A023770 K OS E KRW S outh K orea 7, 910 15.6 15.6 (1. 2) -7.6% 1. 0x - NA ZipL ocal Inc. 12/31/2008 T S X V :ZIP T S XV C AD C ana da 0.01 0.7 2.9 (3. 1) NM 0. 7x - NA High 18,192.6 1,796. 0 577.4 65.0% 46.8x 34.1x 6,194 L ow 0.0 0.0 -15.7 -98. 9% 0. 0x 0. 3x 1 Average 530.5 151.9 34.6 8.7% 5.4x 9.3x 664 Media n 52.9 54.3 0.9 17.1% 1. 8x 8. 6x 238 Figure 1. Web 2.0 Universe Summary Source. Capital IQ
  • 3. Page 3 C A P I T A L M A R K E T S A C T I V I T Y (M & A A N D F I N A N C I N G ) Financing activity in May lags: Month-to-date financings in May totalled $106.6 million, led by the $20 million One Net financing. So far, there have been 18 financings in May, with 10 deals greater than $5 million and only five less than $5 million. There have been two financings greater than $10 million (Cyberplex and One Net), with the capital raises by Imeem and EveryZing close behind at $8.8 million and $8.3 million, respectively. The average value thus far in May is $5.9 million, slightly below the average value for April of $6.5 million on 21 financings. The March average was $6.6 million on 24 financings. Except for two deals (Kaixin001.com and Collective Media), all were below $20 million for the last three months and a total of four deals were greater than or equal to $15 million. Financing Activity Last Three Months 180.0 7.0 160.0 6.0 140.0 5.0 120.0 4.0 100.0 (US$m) (US$m) 80.0 3.0 60.0 2.0 40.0 1.0 20.0 0.0 0.0 Mar-09 Apr-09 May-09 Total Average Figure 2. Financings, Last Three Months Source. Company reports One Net’s $20 million financing is largest deal in May: One Net announced a $20 million financing last week, the largest deal so far in May. Ten of the 18 deals in the month are equal to or greater than $5 million. For additional details, see Figures 23 and 24 (at end of note). Also note that the spin-off of StumbleUpon from E-bay on a $29 million valuation occurred in May. E-bay had bought StumbleUpon for $75 million.
  • 4. Page 4 Financing & M/A Summary - Last Three Months 35.0 30.0 25.0 20.0 May-09 (US$m) Apr-09 Mar-09 15.0 10.0 5.0 0.0 Pixazza Cyberplex Socialtext Mixercast OLX Collective GOOM Radio Vidyo Marin Software Miva EveryZing I Love Greystripe Viximo IMShopping AnySource Tribal Nova VoxPop Myngle Mo'Minis Kaixin001.com Buzznet SendMe Inc. DoubleTwist Tynt OMGPOP TubeMogul The Rubicon LendingClub Auditude Cellufun Glam Media Visible Batanga DocuSign Apture SoundCloud Tripbase Hunch Resonate AdultSpace Jodange Foodista Azuki Systems Medialets Bit.ly Brandtology Loop'd Network Three Melons One Net Conductor Inc. SuperSecret ScanScout BlogHer Inc. Gist Fuhu Inc. Socialcast Scan & Target GoViral StumbleUpon TimeBridge Sports 33Across Simulmedia Imeem FreeWheel Figure 3. Capital Market Activity, Last Three Months Source. Company reports Ad Network remains the most active sector: Activity over the last three months was busiest in the Ad Network sector, with 10 companies raising over $78.7 million (Figure 4). The Media sector has the next highest totals, with eight companies raising $63.4 million. The following sectors continue to generate the most capital activity over the last few months: Ad Network, Media, Gaming, Video, and Social Networks.
  • 5. Page 5 Capital Market Activity by Sector - Last Three Months 90.0 80.0 70.0 60.0 50.0 (US$m) 40.0 78.7 63.4 30.0 50.6 49.5 49.3 20.0 30.2 10.0 18.3 14.4 12.0 12.0 10.4 8.9 7.5 7.0 6.8 5.9 5.5 5.0 4.7 4.1 3.1 2.0 2.0 2.0 1.3 1.3 0.0 0.6 Comment/Reputation Social Commerce Gaming Visual Commerce Travel Wiki Media Mobile Enterprise Collaboration Publishing Microblog Online Learning Widget Search Lending Infrastructure Blog Mobile Ad Social Networks SAS Video Virtual World Aggregation Crowdsourced Ad Network Analytics Content # companies 10 8 9 5 7 2 2 3 1 1 2 2 2 1 1 1 1 1 1 1 1 1 1 1 1 1 1 Figure 4. Capital Market Activity, by Sector, Last Three Months Source. Company reports C A P I T A L M A R K E T S A C T I V I T Y (P R I C E P E R F O R M A N C E ) Web 2.0 index outpaces NASDAQ recovery: Our W eb 2.0 index (market-cap weighted) essentially mirrored the performance of the NASDAQ composite index from mid-2008 until recently. However, the index has recently had a much stronger recovery relative to the NASDAQ index (Figure 5).
  • 6. Page 6 Web 2.0 Index Price Performance 120 100 80 60 40 20 0 5/27/2008 6/10/2008 6/24/2008 7/8/2008 7/22/2008 8/5/2008 8/19/2008 9/2/2008 9/16/2008 9/30/2008 10/14/2008 10/28/2008 11/11/2008 11/25/2008 12/9/2008 12/23/2008 1/6/2009 1/20/2009 2/3/2009 2/17/2009 3/3/2009 3/17/2009 3/31/2009 4/14/2009 4/28/2009 5/12/2009 ^COMP - Share Pricing Index: Web 2.0 X (Market Cap) Figure 5. Web 2.0 Price Performance Source. Capital IQ A strong price performance week: The companies in our universe had relatively strong stock price performances over the past week (for stocks with prices greater than $1) (Figure 6), with 31 companies showing positive returns on the week. OpenW ave Systems (NASDQ:OPW V) led the group with a 49.2% return, while DigitalTown (OTCBB:DGTW ) had the worst return, dropping 35.0% in the week.
  • 7. Page 7 1 Week P rice P erformance Openw ave S y s tems Inc. 49.2% Webz en Inc. 45.8% A ctoz S of t Co., Ltd. 45.0% Chines e Gamer International 39.7% Gamania Digital Entertainment Co., 34.4% A Q Interactiv e, Inc. 27.6% G ravity Co., Ltd 20.4% NEOWIZ Games Corporation 20.2% K ings of t Co. Ltd. 18.1% S handa Interactive Entertainment Ltd. 13.3% CDC Corp. 11.7% Ngi G roup Inc. 11.7% Mix i, Inc. 11.4% My riad Group A G 9.1% S K Communications Co., Ltd. 8.5% Neteas e.com Inc. 7.6% Perfect World Co., Ltd. 7.3% XING A G 5.9% G ameOn Co Ltd. 5.3% S hutterf ly , Inc. 3.9% Tree.Com, Inc. 3.7% IA C/InterA ctiveCorp. 3.5% Y edangOnline Corp. 3.3% S ohu.com Inc. 3.2% Y nk K orea Inc. 2.7% TheS treet.com, Inc. 2.7% HanbitS of t, Inc. 2.4% Open Tex t Corp. 1.2% PhotoChannel Netw orks Inc. 0.6% Giant Interactive G roup, Inc. 0.2% G igaMedia Ltd. 0.2% V alueClick Inc. -0.5% Cy berplex Inc. -0.6% United Online Inc. -0.9% LookS mart, Ltd. -1.5% Changy ou.com Limited -2.3% Tencent Holdings Ltd. -2.8% The9 Limited -3.1% DA DA S pA -3.3% G ree, Inc. -3.5% NetDragon WebS of t, Inc. -4.4% Modern Times G roup Mtg A B -4.5% Frogs ter Interactiv e Pictures A G -6.5% B ey ond Commerce, Inc. -7.3% Lingo Media Corporation -8.7% S park Netw orks , Inc. -10.7% GungHo Online Entertainment, Inc. -10.8% Eolith Co. Ltd. -16.0% Northgate Technologies Limited -31.0% DigitalTow n, Inc. -35.0% -40.0% -30.0% -20.0% -10.0% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% Figure 6. 1-Week Price Performance Source. Capital IQ
  • 8. Page 8 INDUSTRY NEWS (PARTNERSHIPS, FINANCIAL RESULTS, NEW PRODUCTS) K ey Developments C ompany Headline Notes GigaMedia L td. (Nas daqGS : G IG M) G igaMedia Ltd. Appoints Michael Ding as C hairman G iga Media L td. a nnounced that board member Michael Ding ha s been appointed C ha irma n of the board by the directors . Michael Ding became a member of the compa ny's boa rd in J uly 2003 and wa s appointed non-E xecutive C hairma n of the company by the boa rd of directors on Ma y 14, 2009. VOIS , Inc. (OTC B B : VOIS ) V O IS Inc. Announces E a rnings R es ults for the S econd V OIS Inc. a nnounced ea rnings res ults for the s econd quarter ended March 31, 2009. F or the quarter, the compa ny reported net los s of Quarter E nded Ma rch 31, 2009 $153, 685. In contra s t, the company pos ted a net los s of $478,680 for the s ame qua rter in the previous yea r. S NAP Interactive, Inc . (OTC B B : S TVI) S NAP Intera ctive Inc. R eports Una udited C ons olida ted S NAP Intera ctive Inc. reported unaudited cons olidated ea rnings res ults for the firs t qua rter ended March 31, 2009. R evenue for the three E a rnings R es ults for the F irs t Q ua rter E nded Ma rch 31, months ended Ma rch 31, 2009 wa s $768, 972, a s compa red to $519, 902 for the three months ended March 31, 2008, a 48% increa s e. T hes e 2009 revenues a re primarily generated from advertis ements a nd premium features pla ced on various applica tions . T he yea r-on-yea r increas e in revenue wa s primarily due to increa s ed a ctivity on a pplica tions as well as the introduction of revenue-generating premium fea tures . T he company's revenue of $768, 972 for the three months ended March 31, 2009 repres ented a 29% decreas e as compa red to revenue of $1, 087, 144 for the quarter ending December 31, 2008. T he decrea s e in s equential quarterly revenue was largely due to the declining s ta te of the a dvertis ing ma rket a nd the as s ociated declining payouts . Net income for the three months ended March 31, 2009 was $66,472 or $0. 01 per diluted s hare a s compa red to net income of $190, 509 or $0. 02 per diluted s hare for the quarter ended Ma rch 31, 2008, a 65% decreas e. T he decreas e in net income wa s primarily due to the provis ion for income ta xes which were not paid during the s a me period la s t year due to a XING AG (XTR A: O1B C ) XING La unches F irs t OpenS ocial Applica tions X ING has la unched its firs t O penS ocia l a pplica tions --'XING News ' a nd 'As k XING '--as beta vers ions . T he compa ny is adopting a viral a pproach here, allowing the s ocia l a pplica tions to dis tribute throughout the network. B eta tes ters ' profiles and information about their a ctivities in the 'W ha t's new in my network' ticker let other members know tha t they are us ing the a pps and how they a re us ing them-- prompting other members to dis cover the new fea tures a nd ins ta ll them for thems elves . In the firs t five da ys s ince the la unch, the number of beta tes ters ros e from a round 200 to more than 30, 000, res ulting in a record high in the level of tra ffic on the XING webs ite. S oc ialwis e, Inc . (OTC B B : S C L W) S ocia lwis e La unches Unique O nline P ayment S ys tem for S ocia lwis e Inc. la unched B illMyP a rents , a n innova tive online youth pa yment s ys tem tha t gives teens the freedom to s hop online and pa rents T eens a nd P arents the control over thes e purchas es , a ll in a s imple, automated s ys tem tha t keeps credit ca rd numbers a nd other pers ona l informa tion s afe and s ecure. T he B illMyP a rents payment s ys tem pla tform addres s es this unta pped teen s pending ma rket with a multifa ceted a pproach to online payment proces s ing for teens a nd tweens , and gives them a n ea s y wa y to purchas e products online without a credit ca rd. Us ing the B illMyP a rents button at the point of s a le, teens ca n initiate a purcha s e in s econds . P a rents complete the purchas e a t their convenience through a s imple, eas y to us e a nd automated s ys tem ena bled by ins ta nt ema il a nd text notifications . At la unch, the B illMyP arents pa yment s ys tem pla tform includes : B illMyP arents S hopping e-commerce s ite: T o give teens immediate acces s to more than a million products , B illMyP a rents has la unched a s hopping s ite powered by Ama zon. com through their as s ociate program. T he B illMyP arents S hopping s ite gives teens and tweens a cces s to the entire inventory a vaila ble online on Ama zon.com, without needing a credit card to make purchas es . T ee P erfect W orld C o., L td. Upda te to P erfect W orld C o., L td. ’s E quity B uyback on As of Ma y 17, 2009, the company has repurcha s ed 1,683, 192 ADS 's (equiva lent to 8, 415, 960 s ha res ) and 18, 750, 000 s ha res , under its (Nas daqG S : P WR D) Ma y 17, 2009 s ha re repurcha s e pla n. J uile G a o of L atham & W atkins L LP acted a s legal advis or to P erfect W orld. S pectrumDNA, Inc . (OTC B B : S P XA) IAC 's Dictionary.com S elects Addictionary to P ower New S pectrumDNA has pa rtnered with Dictionary. com, an operating bus ines s unit of IAC , to licens e its awa rd-winning Addictionary, a S aa S W ordpla y O ffering (s oftwa re-a s -a -s ervice) us er-generated dictiona ry that lets people create their own words and definitions . T he dea l ma rks S pectrumDNA's firs t entree into IAC 's network of s ites and follows dis tribution deals with NB C Univers a l a nd s evera l C omca s t Networks properties . S pectrumDNA, a s ocial media s tudio tha t creates Digita l Network Applica tions a nd engines of engagement (or 'E nginets ') for media outlets a nd a dvertis ers , is collaborating with IAC to packa ge a nd s ell their bra nded Addictiona ry a s a one-of-a-kind, online s pons ors hip a nd vira l marketing platform to attra ct premium bra nd-a dvertis ing dolla rs . P erfect W orld C o., L td. P erfect W orld C o. Ltd. R eports Una udited C ons olida ted P erfect W orld C o. Ltd. reported unaudited cons olidated fina ncia l res ults for the firs t quarter ended March 31, 2009. F or the quarter, the (Nas daqG S : P WR D) F ina ncial R es ults for the F irs t Q ua rter E nded March 31, company reported tha t total revenues were C NY 425. 1 million, a n increas e of 40.2% from C NY 303. 2 million for the firs t quarter of 2008. 2009 ; P rovides R evenue G uida nce for the S econd O pera ting profit was C NY 230. 4 million, an increas e of 42.6% or C NY 68. 8 million from C NY 161.6 million in firs t quarter of 2008. Non-G AAP Quarter of 2009 opera ting profit was C NY 245. 8 million, an increas e of 45.0% or C NY 76. 3 million from C NY 169. 5 million in firs t qua rter of 2008. Net income wa s C NY 215.4 million, a n increa s e of 36. 1% or C NY 57.1 million from C NY 158.4 million in firs t quarter of 2008. Non-G AAP net income wa s C NY 230.9 million, a n increa s e of 38. 8% or C NY 64.6 million from C NY 166.3 million in firs t quarter of 2008. Diluted ea rnings per ADS were C NY 3.96 a s compa red to C NY 2. 67 in firs t quarter of 2008. Non-G AAP diluted ea rnings per ADS were C NY 4. 25 as compared to C NY 2. 81 in firs t qua rter of 2008. P rofit before ta x was C NY 235. 4 million compa red to C NY 164.00 million reported a year ago. Net earnings per diluted s ha re was C NY 0. 79 compa red to C NY 0. 53 reported a yea r ago. Net cas h provided by operating activities was C NY 249. 92 million co DigitalP os t Interac tive, Inc . Digita lP os t Interactive Inc. R eports E a rnings R es ults for Digita lP os t Interactive Inc. reported earnings res ults for the firs t qua rter ended Ma rch 31, 2009. F or the quarter, the company's revenues (OTC B B : DG L P ) the F irs t Q ua rter E nded March 31, 2009 ros e to $311,000, from $51, 300 in the firs t qua rter 2008. T he increa s e wa s driven largely by growth in the number of s ubs cribers genera ted by the company's ma rketing pa rtners hip with K iddie K andids and revenue from profes s ional s ervices that were implemented during the firs t qua rter 2009 for bus ines s es s eeking intera ctive media to enha nce market a warenes s a nd pres ence. Net ca s h us ed by opera ting a ctivities in the firs t qua rter 2009 declined to $62,100 from $412,300 in the firs t quarter 2008 a nd reflected in pa rt the compa ny's cos t-reduction efforts . TheS treet.c om, Inc. (Nas daqGM: TS C M) T heS treet.com Inc. Appoints Da ryl Otte a s C hief T heS treet. com Inc. a nnounced that it ha s appointed Daryl O tte a s C hief E xecutive Officer. Mr. Otte ha d previous ly been the company's E xecutive Officer Interim C E O , a pos ition he was named to in Ma rch 2009. Mr. Otte, 47, has s erved as a Director of the company s ince 2001 and has previous ly s erved as the C ha irma n of the compa ny's Audit C ommittee. L iveWorld Inc. (OTC P K : L VWD) LiveW orld Inc. R eports Una udited C ons olidated E a rnings L iveW orld Inc. reported una udited cons olida ted ea rnings res ults for the firs t quarter March 31, 2009. F or the qua rter, the compa ny reported R es ults for the F irs t Quarter March 31, 2009 ; P rovides $2. 6 million in tota l revenues compared to the $3.0 million in total revenues reported for the firs t quarter of 2008. Net income of $21,000 R evenue G uida nce for the S econd Quarter of 2009 compared to the net los s of $503,000 or $0. 02 per ba s ic s hare reported for the firs t quarter of 2008. Income from operations wa s $17, 000 compared to los s from operations of $486,000 for the s ame period of la s t yea r. Income before ta x was $17,000 compa red to los s before ta x of $500, 000 for the s a me period of la s t yea r. Net cas h provided by operating activities wa s $179, 000 compared to net cas h us ed in opera ting a ctivities of $37, 000 for the s a me period of las t yea r. P urchas e of property a nd equipment was $39, 000 compa red to $94, 000 for the s a me period of la s t year. Adjus ted E B IT DA was $239,000, which was a s ignifica nt improvement from the $243,000 los s for the firs t qua rter of 2008. T he compa ny a nticipates its total revenues will be les s than it reported for the s econd qua rter of 2008 a nd inline with the revenues for the firs t qua rter of 2009. However, the company believes the cos t reductions will improve the s econd qua rter operationa l res ults compa red to the s econd q Openwave S ys tems Inc. Openwave S ys tems Inc. Introduces Openwa ve Loca tion O penwa ve S ys tems Inc. a nnounced Openwa ve Loca tion E xpres s for G S M/UMT S , an eas y-to-deploy, loca tion-bas ed infra s tructure a ppliance (Nas daqG S : OP WV) E xpres s for O pera tors in E merging Ma rkets tha t ena bles ra pid entry into the location-ba s ed s ervices ma rket. L oca tion E xpres s s upports both bas ic and a dva nced loca tion-bas ed s ervices (L B S ) and is compatible with G S M/UMT S mobile phone and network s ta ndards . L B S s olution tha t helps enable operators in emerging markets quickly deploys s ecure loca tion-ba s ed s ervices . B a s ic LB S enabled by L ocation E xpres s utilizes C ell/S ector ID pos ition informa tion to offer low cos t s ervices to a variety of s ubs criber s egments a nd prepa id us ers with entry level voice and S MS ca pa ble hands ets . Loca tion E xpres s ca n als o ena ble bas ic enterpris e fleet tracking applications s atis fied by C ell ID level accuracy, for exa mple tra cking the progres s of long dis ta nce pas s enger bus es a nd tra ns port vehicles . Advanced L B S ena bled by Loca tion E xpres s is ba cked by high a ccura cy As s is ted G P S (A-G P S ) technology, which a llows an opera tor to offer more s ophis tica ted high-a ccura cy cons umer s ervices s uch as turn by turn navigation and child loca tor-type a pplica tions . In addition, a dva nced fleet tra cking s ervices a llow bus ines s es to monitor th IB 3 Networks , Inc . (OTC B B : IB NW) iB 3 Networks Inc. a nd iB eam S olutions Announce iB 3 Networks Inc. and its wholly owned s ubs idia ry iB ea m S olutions announced tha t its client Hull & As s ociates Inc. , ha s extended its IT E xtens ion of IT Ma na ged S ervice C ontra ct for O ne Y ear Managed S ervice contract for O ne Y ear for $144, 000. with C lient Hull & As s ociates Inc
  • 9. Page 9 E xtens ions , Inc. (OTC P K : E XTI) E xtens ions Inc. R eports E arnings R es ults for the F irs t E xtens ions Inc. reported ea rnings res ults for the firs t qua rter ended March 31, 2009. F or the qua rter, the compa ny reported a net los s of Quarter E nded Ma rch 31, 2009 $21,582. In contras t, the compa ny pos ted a net los s of $76,529 for the s ame qua rter in the previous yea r a nd a $357, 468 a ccumulated net los s s ince inception on F eb. 19, 1997. Myriad G roup AG (S WX: MYR N) Myria d G roup AG , Annua l G enera l Meeting, Ma y 19, Myria d G roup AG , Annua l G eneral Meeting, May 19, 2009, a t 15: 00 C entral E urope S ta ndard T ime. Loca tion: R adis s on B lu Hotel, Zurich- 2009 Airport, Zurich, S witzerla nd. Agenda : T o re-elect board members Ha ns -Ulrich Muller and J ea n S chmitt for a term of office of one yea r . L iveWorld Inc. (OTC P K : L VWD) B ra veHea rt W omen S elects LiveW orld a s P rovider for B raveHeart W omen has s elected LiveW orld Inc. a s provider of its new online community des cribed as S ocia l Networking W ith a P urpos e. New S ocial Network About Ins piring a nd E mpowering T he new online community is built on L iveW orld's la tes t vers ion of its C ommunity C enter P ro-E dition pla tform and features member profiles , W omen friends lis ts , gues tbooks , forums , blogs , photo a lbums , us er video, groups a nd more. C yberplex Inc. (TS X: C X) C yberplex Inc. ha s filed a F ollow-on E quity Offering in the C yberplex Inc. has filed a F ollow-on E quity O ffering in the a mount of C AD 15. 00 million. amount of C AD 15.00 million. O ffer Details : S ecurity T ype: C ommon S tock O ffered: 9375000 P rice/R a nge: 1. 60 Neteas e.com Inc. (Nas daqGS : NTE S ) Netea s e.com Inc. Announces Unaudited C ons olida ted Neteas e. com Inc. a nnounced unaudited cons olidated ea rnings res ults for the firs t qua rter ended March 31, 2009. F or the qua rter, the E a rnings R es ults for the F irs t Q ua rter E nded Ma rch 31, company has reported operating profit of C NY 491, 098,085, net income before ta x of C NY 478, 441, 772, net income after tax of C NY 2009 416,702, 625 and net income attributable to s hareholders of C NY 416,720, 842 or C NY 0. 13 diluted ea rnings per s ha re and C NY 3.23 diluted earnings per ADS on tota l revenues of C NY 781, 694, 557 compared to opera ting profit of C NY 404, 383, 564, net income before ta x of C NY 384,179, 583, net income a fter ta x of C NY 269, 346, 735 a nd net income a ttributa ble to s ha reholders of C NY 269, 350, 246 or C NY 0. 08 diluted earnings per s hare a nd C NY 2. 08 diluted ea rnings per ADS on total revenues of C NY 651,923,462 for the s ame period las t yea r. T otal net revenues for the qua rter were C NY 775,922, 426 agains t C NY 644, 453,652 reported la s t yea r. Net cas h provided by operating activities were C NY 567,784, 380 aga ins t C NY 494, 960,784 reported las t yea r. In the quarter, the compa ny reported capita l expenditure of C NY 23, 031, 133 on purchas e of property, equipment and s oftwa re compa red to C NY 15,418, 337 reported las t year. Neteas e.com Inc. (Nas daqGS : NTE S ) Upda te to Netea s e.com Inc’s E quity B uyba ck on March As of Ma rch 31, 2009, Netea s e. com Inc has repurcha s ed own s ha res worth $13.1 million, under the s hare repurcha s e plan, a nnounced on 31, 2009 S eptember 12, 2008. J umbuck E ntertainment Pty L td. J umbuck E ntertainment P ty Ltd. La unches P ower C ha t J umbuck E ntertainment P ty Ltd. ha s relea s ed its mobile chat a nd flirt s ervice, P ower C ha t(T M), as a n iP hone application. It is ava ilable for (AS X: J MB ) for iP hone immediate downloa d in the Apple App S tore for $2. 99. B ecaus e it ta ps into J umbuck's enormous globa l us er bas e, P ower C ha t us ers on the iP hone and iP od T ouch now have ins tant a cces s to a divers e mobile community of more than 15 million people around the world, even people who a re not us ing an iP hone or who a re on a non-iP hone carrier. P ower C ha t for iP hone and iP od T ouch delivers all the core P ower C hat capabilities plus s ome cool features that a re unique to the iP hone vers ion: -P ublic C hat R ooms --there's a lwa ys s omeone looking to cha t. C hoos e from various themed rooms including F lirt, S ingles , F riends , Da ting, S ports , Da C lub, W orld C hat, a s well as regiona l a nd age- s pecific rooms , -P hotos --check out other cha tters ' photos in chat rooms . S elect a chatter to s ee profile informa tion, more photos , a nd s end mes s ages directly to tha t pers on, -P ers ona l C hats --one-to-one chat enables to take a public chat priva te, -F riends Lis t--keep track of friends , s end private mes s ages . a nd s ee when your favorite chatters are online, -P hoto Upload--eas ily upload photos s tored on your iP hone or ta ke a n Magnitude Information S ys tems Inc. Ma gnitude Informa tion S ys tems Inc. R eports E arnings Magnitude Information S ys tems Inc. reported ea rnings res ults for the firs t quarter ended March 31, 2009. F or the quarter, the compa ny (OTC B B : MAGY) R es ults for the F irs t Quarter E nded Ma rch 31, 2009 reported net los s of $1.36 million. In contra s t, the company pos ted a net los s of $2.14 million for the s a me quarter in the previous year. Worlds .c om Inc . (OTC B B : W DDD) W orlds . com Inc. R eports E a rnings R es ults for the W orlds . com Inc. reported earnings res ults for the qua rter ended Ma rch 31, 2009. F or the qua rter, the company reported a net los s of Quarter E nded Ma rch 31, 2009 $242, 441. In contra s t, the company pos ted a net los s of $107,954 for the s ame qua rter in the previous yea r. K aboos e Inc . (TS X: K AB ) K a boos e Inc. has C hanged its Name to K AB Dis tribution K a boos e Inc. changed its na me to K AB Dis tribution Inc. Inc K ings oft C o. L td. (S E HK : 3888); The9 K ings oft a nd T he9 Announces C oopera tion in J X3 O nline K ings oft C o. L td. will coopera te with T he9 Limited on the opera tion of J X3 O nline. T he9 will keep its ha rdwa re under opera tion and L imited (Nas daqG S : NC TY) Operation cons olida te its s ta tus over the C hines e online gaming market. B ecaus e the operation of C hina -des igned online games cos ts les s than tha t of W oW . C yberplex Inc. (TS X: C X) C yberplex Inc. , Annual G enera l Meeting, Ma y 21, 2009 C yberplex Inc. , Annua l G enera l Meeting, Ma y 21, 2009, at 09:00 E as tern Da ylight. Loca tion: 1255 B a y S treet, S uite 400, T oronto M5R 2A9, O ntario, C anada . Agenda: T o receive a nd cons ider the audited cons olidated financia l s tatements of the C orporation for the fis cal yea r ended December 31, 2008 and the a uditors ' report thereon; to elect directors ; to a ppoint a uditors and to a uthorize the directors of the C orporation to fix the auditors ' remunera tion; a nd to trans a ct s uch further or other bus ines s a s may properly come before the Meeting or a t a ny a djournments thereof . K aboos e Inc . (TS X: K AB ) K a boos e Inc. , Annua l G eneral Meeting, May 21, 2009 K a boos e Inc., Annual G eneral Meeting, May 21, 2009, a t 09: 00 E a s tern Daylight. L ocation: S tikema n E lliott L LP , 5300 C ommerce C ourt W es t, 199 B ay S treet, T oronto M5L 1B 9, Onta rio,C a na da . Agenda : T o receive a nd cons ider the a nnua l report to the s hareholders , the a nnua l cons olida ted fina ncial s ta tements of the corporation for the fis cal yea r ended December 31, 2008 and the report of the a uditor thereon; to elect the directors of the corporation; to appoint an a uditor of the corpora tion a nd to a uthorize the directors to fix the a uditor's remunera tion; to cons ider, and, if deemed advis a ble, to pa s s , with or without va ria tion, a s pecia l res olution of the s ha reholders to a pprove the s ale, directly a nd indirectly, by the corpora tion of all of the is s ued a nd outs ta nding s ha res of its s ubs idia ry, K a boos e Acquis ition (UK ) C ompany. S hutterfly, Inc. (Nas daqG S : S F L Y) S hutterfly Inc., Annual G eneral Meeting, Ma y 21, 2009 S hutterfly Inc. , Annua l G enera l Meeting, Ma y 21, 2009, at 11:00 P acific Da ylight. L oca tion: 1300 Is la nd Drive, R edwood C ity, C A 94065,United S ta tes . Agenda: T o elect three C las s III directors to hold office until its 2012 Annua l Meeting of S tockholders ; to re-approve the Internal R evenue C ode S ection 162(m) provis ions of its 2006 E quity Incentive P lan to pres erve its a bility to deduct for corpora te income tax purpos es compens a tion tha t qualifies as performa nce-bas ed compens ation under S ection 162(m) of the Interna l R evenue C ode; to ratify the s election by the Audit C ommittee of its B oa rd of Directors of P ricewa terhous eC oopers LL P a s its independent regis tered public a ccounting firm for the fis cal yea r ending December 31, 2009; and to conduct a ny other bus ines s properly brought before the meeting. Magnitude Information S ys tems Inc. Ma gnitude Informa tion S ys tems Inc. Names Andre O n Ma y 13, 2009, the B oard of Directors of Ma gnitude Informa tion S ys tems Inc. a ppointed Andre S cholz to s erve a s a director of company (OTC B B : MAGY) S cholz a s a Director a nd a s a C ons ultant; Announces a nd a s a cons ulta nt. As a cons ultant, Mr. S cholz will s erve in the roles of C hief T echnology O fficer for the compa ny and in the roles of C ons olida tion of B us ines s O pera tions in its New Y ork P res ident a nd C hief E xecutive Officer for K iwibox Media, Inc. , the compa ny's wholly owned and principal bus ines s s ubs idiary. Mr. S cholz, 31 C ity O ffices years of age, is currently the G eneral Ma na ger / C E O of Inters cholz B eteiligungs G mbH a nd Inters cholz Internet S ervices G mbH & C o. K G , G erman companies loca ted in S tuttga rt, G erma ny. Mr. S cholz als o owns a nd ma na ges Adva nced T echnology G roup Deuts chland G mbH, a ls o loca ted in S tuttga rt, which is enga ged in the development and marketing of computer, pa tented algorithms in the E uropea n ma rket for pattern recognition. In connection with its bus ines s reorga niza tion, the compa ny ha s cons olida ted the s ites of its bus ines s operations in its New Y ork C ity offices , loca ted a t 330 W es t 38th S treet, now its principal offices , and ha s termina ted its lea s e for its New J ers ey office loca ted at 1250 R oute 28, B ranchburg, New J ers ey. Neteas e.com Inc. (Nas daqGS : NTE S ) Netea s e.com Announces E xpa ns ion in O nline G ame Neteas e. com Inc. is gea ring up for the operation of the W orld of W a rcra ft in Ma inla nd C hina . T he compa ny ea rlier won a licens e from US - S ector bas ed online game tita n B lizza rd E nterta inment to opera te the la tter's W orld of W a rcra ft on the ma inla nd. Ha ving purchas ed equipment neces s a ry for the operation of W orld of W arcra ft, NetE as e. com is equipping bra nd new hardware fa cilities for the online ga me. T he W orld of W arcra ft NetE a s e. com a uthorized to run is jus t part of its s tra tegic expans ion.
  • 10. Page 10 ZipL ocal Inc. R eports C ons olida ted Una udited C apital ZipL oca l Inc. reported cons olida ted unaudited ca pita l expenditure for the third qua rter a nd nine months ended Ma rch 31, 2009. F or the E xpenditure for the T hird Q ua rter a nd Nine Months quarter, the compa ny reported ca s h us ed in opera ting a ctivities wa s C AD 115, 180 a ga ins t the C AD 1, 127, 861 for the s ame period a yea r E nded Ma rch 31, 2009 a go. T he compa ny s pends C AD 12, 953 on purcha s e of property, pla nt a nd equipment. F or the nine months , the compa ny reported ca s h us ed in opera ting a ctivities wa s C AD 1, 439, 974 aga ins t the C AD 3, 800, 382 for the s a me period a yea r a go. T he compa ny s pends C AD 15, 817 on purcha s e of property, pla nt a nd equipment a ga ins t the C AD 136, 084 for the s a me period a yea r a go. ZipL ocal Inc. R eports E a rnings R es ults for the T hird ZipL oca l Inc. reported ea rnings fina ncial res ults for the third qua rter and nine months ended Ma rch 31, 2009. Net revenues for the three Qua rter a nd Nine Months E nded March 31, 2009 months ended Ma rch 31, 2009 were $687, 481, repres enting a decrea s e of $225, 658, or 25% from $913, 139 as recorded in the s a me period in the prior yea r. Net los s for the period wa s a t $253, 179, compa red to a los s of $1, 379, 804, or $0. 02 per s ha re, for the s a me period in the prior yea r. T he C ompa ny is s eeing improvements in the opera ting res ults from the continued a nd a ggres s ive efforts to decrea s e expens es a nd increas es in productivity with a reduced number of s ta ff. T hes e initiatives ha ve s een a n improvement in Adjus ted E B IT DA los s . Adjus ted E B IT DA los s for the three months ended March 31, 2009 wa s $61, 043 repres enting a n improvement of $353, 503 from $414, 546 for the three months ended December 31, 2008. Net revenues for the nine months ended Ma rch 31, 2009 were $2, 181, 582, repres enting a decrea s e of $950, 545, or 30% , from $3, 132, 127 a s recorded in the s ame period in the prior yea r. Net los s was a t $1, 905, 273, or $0. 02 per s ha re, compa red to a los s of $4, 604, 372, or $0. 07 per s ha re, for the s ame period in the prior yea r. K ings oft C o. L td. , Annua l G enera l Meeting, Ma y 25, 2009 K ings oft C o. L td. , Annua l G enera l Meeting, Ma y 25, 2009, a t 15: 00 C C T -C hina C oa s t, US S R Zone 7. Location: Zhuhai K ings oft S oftware C o. L td. , K ings oft T ower, #8 L ia ns han Alley, J ings ha n R oa d, J ida, Zhuha i, P R C , 519015, G uangdong P rovince, C hina . Agenda : T o receive a nd cons ider the a udited cons olidated fina ncia l s ta tements , the report of the directors a nd the independent a uditors ' report for the yea r ended December 31, 2008; to decla re a fina l dividend; to re-elect directors a nd authorize the board of directors to fix the directors ' remunera tion; to re-a ppoint a uditors a nd to a uthorize the boa rd of directors to fix the a uditors ' remuneration a nd to cons ider; and to fit other res olution. Figure 7. Key Developments Source. Capital IQ
  • 11. Page 11 VALUATION Online Gaming companies lead market-cap charts: Eleven companies in our W eb 2.0 universe top US$1 billion in market capitalization (Figure 8). Sixty of the 93 companies have market caps under US$100 million, with 23 under $10 million. Online gaming companies dominate the top of the list, led by Tencent Holdings with a market cap over $18 billion. Market C ap (US D m) Tencent Holdings L td. Neteas e. com Inc. S handa Interactiv e Entertainment L td. 3811.2 IA C/InterA c tiveCorp. 2334. 7 S ohu. com Inc. 2075.4 Modern Times G roup Mtg A B 1938. 6 G iant Interactiv e G roup, Inc. 1866.8 Open Tex t Corp. 1657.6 Changy ou.c om Limited 1595. 6 Gree, Inc. 1247.3 Perfect World Co. , L td. 1020.3 Chines e Gamer International 974. 9 V alueClick Inc. 872.3 K ings oft Co. L td. Mix i, Inc. 761. 4 0 783. NEOWIZ Games Corporation 598. 5 United Online Inc. 548. 3 NetDragon WebS of t, Inc. 371.6 S hutterf ly, Inc. 359.7 S K Communications Co. , L td. 336. 5 GigaMedia L td. 321. 5 G amania Digital Entertainment Co. , 245.8 The9 Limited 240. 6 XING A G 240. 4 G ungHo Online Entertainment, Inc. 187. 1 OA O R B C Information S ys tems 173. 4 CDC Corp. 151.7 Openw av e S ys tems Inc. 149. 1 A c toz S oft Co. , L td. 149. 0 Y edangOnline Corp. 136. 0 DA DA S pA 134. 5 Tree.Com, Inc. 131. 7 Myriad G roup A G 118.0 G ameOn Co L td. 98. 5 HanbitS of t, Inc. 97. 1 Moggle, Inc 83.5 Cyberplex Inc. 82.9 JumpTV Inc. 80.9 K aboos e Inc. 75. 9 G eoS entric Oy j 62. 7 TheS treet. com, Inc. 58. 2 Webz en Inc. 53. 8 PhotoChannel Netw orks Inc. 52. 0 B ey ond Commerce, Inc. 51. 0 Eolith Co. L td. 48. 6 S park Netw orks , Inc. 46. 3 Ngi Group Inc. 44. 3 NeXplore Corporation 39. 0 A Q Interac tiv e, Inc. 38. 4 DigitalTow n, Inc. 35.2 Dolphin Digital Media, Inc. 35.1 Fluid Mus ic Canada, Inc. 35.0 G ravity Co. , L td 32.8 S oc ialw is e, Inc. 32.1 UOMO Media, Inc 28. 3 S ites earch Corporation 28. 2 Northgate Technologies Limited 27. 3 Wiz z ard S of tw are Corporation 27. 2 DXN Holdings B hd 26. 8 Frogs ter Interac tiv e Pictures A G 26. 2 B roadWebA s ia Inc. 25. 3 L ookS mart, L td. 21. 9 S pectrumDNA , Inc. 19. 5 IA S Energy, Inc. 18. 2 J umbuc k Entertainment Pty L td. 15. 9 Y nk K orea Inc. 15. 6 A cc eleriz e New Media, Inc. 14. 4 Ex tens ions , Inc. 14. 2 Quepas a Corp. 12. 2 L ingo Media Corporation 12. 0 Wy nds torm Corporation 9. 2 S NA P Interac tive, Inc. 8. 1 Worlds . com Inc. 7. 9 V OIS , Inc. 7. 5 CornerWorld Corporation 5. 8 B right Things plc 4. 7 Magnitude Information S ys tems Inc. 4. 6 is eemedia Inc. 4. 1 MOK O. mobi Limited 4. 1 B etaw ave Corporation 2. 6 L iveWorld Inc. 2. 2 DigitalPos t Interac tiv e, Inc. 1. 4 B igs tring Corp. 1. 2 Unis erve Communications Corp. 1. 1 ZipL oc al Inc. 0. 7 Financial Media G roup, Inc. 0. 3 The Parent Company 0. 2 Total S port Online A S 0. 1 A s s ociated Media Holdings Inc. 0. 1 China G atew ay Corporation 0. 0 S NM G lobal Holdings 0. 0 Dibz International, Inc. 0. 0 S oc ial Media V enures , Inc. 0. 0 0 500 1, 000 1, 500 2, 000 2,500 3, 000 3, 500 4,000 Figure 8. Market Cap Ranking Source. Capital IQ
  • 12. Page 12 TEV/Revenue (LTM) averages 5.4x: The overall average TEV/Revenue (LTM) multiple for our group is 5.4x (down from 5.6x last week) (Figure 9). Two companies trade at more than 40x revenue – Dolphin Digital (OTCBB: DPDM) at 46.8x and UOMO Media (OTCBB:UOMO) at 45.0x. The median is only 1.8x. Note that we exclude multiples greater than 50x. Thirty companies have multiples under 1.5x. T E V/L T M R evenue (x) 50. 0 46.8 45. 0 45. 0 40. 0 37.6 35. 0 31.7 30. 0 25. 0 20. 0 17. 6 16.06.4 1 15. 0 11.6 8.9 10. 0 7. 88.1 A verage, 5.4 5.55.66.26.3 4. 54.64.64.74.75.15.3 3.33.43.63.7 5. 0 1.01.01.11.11.11.31.31.41.41.41.41.61. 81.81.82. 02.22.52.62.62.73.0 0.00.00.00. 10.10.20. 20.20.20.30.30.40.50.50.60.70.80. 80.9 0. 0 NE O WIZ G a mes C orporation G amania Digital E ntertainment J umbuck E ntertainment P ty Ltd. MO K O .mobi Limited U O MO Media , Inc C hines e G a mer International Unis erv e C ommunic ations C orp. G ungHo O nline E ntertainment, O AO R B C Informa tion S y s tems Northgate T echnologies Limited DX N H oldings B hd C hangy ou.com Limited C DC C orp. G ameO n C o Ltd. T ree.C om, Inc. S K C ommunications C o., Ltd. F luid Mus ic C anada, Inc. Digita lP os t Interac tive, Inc. B ey ond C ommerce, Inc. Dolphin Digita l Media, Inc. T he P arent C ompany Modern T imes G roup Mtg AB G eoS entric O y j S NM G lobal Holdings C ornerWorld C orpora tion Lingo Media C orpora tion U nited O nline Inc. S NAP Interac tive, Inc. O pen T ex t C orp. P hotoC hannel N etwork s Inc. J umpT V Inc. C hina G ateway C orpora tion AQ Interactive, Inc. IAC /InterActiveC orp. S park Network s , Inc. C y berplex Inc. G igaMedia Ltd. V a lueC lick Inc. is eemedia Inc. NetDragon WebS oft, Inc. E olith C o. Ltd. X ING AG S ohu.c om Inc. F rogs ter Interac tive P ictures AG Mix i, Inc. As s oc iated Media H oldings Inc. T enc ent H oldings Ltd. G ree, Inc. S handa Interac tive B right T hings plc S ocial Media V enures , Inc. Liv eWorld Inc. O penwa ve S y s tems Inc. Z ipLocal Inc. Y nk K orea Inc. K aboos e Inc. HanbitS oft, Inc. Y edangO nline C orp. My ria d G roup AG B igs tring C orp. T otal S port O nline AS S hutterfly , Inc. Ac celeriz e New Media, Inc. K ings oft C o. L td. DADA S pA Wiz z a rd S oftware C orporation Actoz S oft C o., L td. Figure 9. TEV/Revenue Ranking Source. Capital IQ TEV/Revenue (LTM) by country/exchange: W e have also calculated multiples based on where the companies are listed or domiciled. Figure 10 shows the average TEV/Revenue multiples by stock exchange. The OTCBB has the largest number of companies (20), trading at an average multiple of 18.7x (down from 20.6x last week). On a geographic basis, the United States has the most companies (40), trading at an average of 5.9x revenue (down from 6.4x last week) (Figure 11). Eleven of the companies are Canadian (average 7.1x revenue). Average TEV/LTM Revenue - By Exchange Average TEV/LTM Revenue - By Country 20.0 18.7 20.0 18.0 17.6 17.6 18.0 16.0 16.0 14.0 12.0 10.8 14.0 12.0 (x) 10.0 8.9 8.9 (x) 8.0 8.9 8.4 10.0 8.9 6.0 8.0 7.1 6.4 4.6 4.1 5.9 5.9 4.0 3.43.3 3.0 2.7 2.1 6.0 1.7 1.7 1.6 1.4 1.4 4.6 4.1 2.0 0.8 0.6 4.0 3.3 2.1 0.0 0.5 0.2 0.0 2.0 1.7 1.4 0.8 0.5 OTCNO OTCPK OTCBB GTSM NasdaqGM TSE KOSE HLSE SEHK NasdaqGS OSE RTS OM CM XTRA TSX AMEX KLSE BSE AIM TSXV SWX 0.4 0.2 0.0 ASX 0.0 Germany United Japan Finland Canada China United Malaysia Hong Kong India Russia Italy South Taiwan Australia Norway Switzerland Sweden # Companies 20 1 5 1 2 3 1 2 5 1 4 2 7 2 14 10 1 1 1 5 1 1 1 # Companies 1 6 1 11 3 10 40 1 2 1 9 2 1 1 1 1 1 1 Figures 10 & 11. TEV/Revenue Ranking (Exchange, Country) Source. Capital IQ TEV/EBITDA (LTM) averages 9.3x: The average multiple for the 34 companies with positive EBITDA (and multiples under 100x) is 9.3x LTM EBITDA (vs. 9.2 last week), led by Tencent Holding’s (700-SEHK) 34.1x multiple (Figure 12). Thirteen of the companies have EBITDA multiples under 7x. The median multiple is 8.3x (vs. 8.2x last week).
  • 13. Page 13 T E V/L T M E B IT DA (x) 40. 0 34. 1 35. 0 30. 0 28. 0 28. 6 25. 0 20. 0 15. 9 14. 3 15. 0 11. 4 A verage, 9.3 10. 4 10. 4 10. 5 10. 5 10. 5 11. 0 11. 0 8. 7 9. 1 9. 3 10. 0 7. 8 8. 1 8. 5 6.8 7.2 7.3 4.7 4.9 5.3 5.4 3. 9 4. 0 5. 0 2. 1 1. 6 2. 0 0. 3 0. 6 1. 1 0. 0 NE O WIZ G ames C orporation J umbuck E ntertainment P ty Ltd. G ungH o O nline E ntertainment, Inc . G amania Digital E ntertainment C o. , Ltd. C hines e G amer International O AO R B C Information S y s tems Northgate T ec hnologies L imited DXN Holdings B hd C hangy ou. c om L imited G ameO n C o L td. C DC C orp. S K C ommunic ations C o. , L td. Modern T imes G roup Mtg AB S handa Interac tive E ntertainment L td. U nited O nline Inc . S NAP Interac tive, Inc . O pen T ex t C orp. AQ Interac tive, Inc . S park Network s , Inc . G igaMedia L td. NetDragon WebS oft, Inc . V alueC lic k Inc . S ohu. c om Inc . C yberplex Inc . IAC /InterAc tiveC orp. Mix i, Inc . T enc ent Holdings L td. XING AG K aboos e Inc. Y edangO nline C orp. S hutterfly , Inc. K ings oft C o. L td. DADA S pA Actoz S oft C o. , L td. Figure 12. TEV/EBITDA Ranking Source. Capital IQ TEV/EBITDA (LTM) by country/exchange: Figure 13 shows the average TEV/EBITDA multiples by stock exchange. The OTCBB has the largest number of companies (20), trading at an average multiple of 7.2x (vs. 7.6x last week). On a geographic basis, the United States has the most companies (40), trading at an average of 7.3x EBITDA (Figure 14). Eleven of the companies are Canadian (average 9.5x EBITDA). Average TEV/LTM EBITDA - By Exchange Average TEV/LTM EBITDA - By Country 25.0 16.0 19.6 14.8 20.0 14.0 14.5 19.0 12.0 15.0 12.7 14.5 10.0 (x) 11.4 11.4 9.5 9.1 (x) 10.0 9.9 9.1 8.0 7.8 7.2 7.2 7.3 5.9 4.9 6.0 6.4 5.4 5.0 4.0 3.9 2.1 1.1 0.3 0.0 4.0 4.9 3.9 0.0 2.0 OTCBB GTSM SEHK KOSE OSE NasdaqGS TSE RTS OM CM XTRA TSX AMEX KLSE BSE 1.1 SWX ASX 2.1 0.0 0.3 Germany China Canada United Japan Hong Malaysia India Russia Italy South Korea Kong States Taiwan Australia Sweden # Companies 2 3 7 2 4 1 1 20 14 5 1 2 1 2 1 1 1 # Companies 3 9 10 2 11 1 40 6 1 1 1 2 1 1 Figures 13 & 14. TEV/EBITDA Ranking (Exchange, Country) Source. Capital IQ P/E (LTM) averages 15.3x: The average multiple for the 31 companies with positive earnings (and multiples under 100x) is 15.3x LTM EPS (vs. 14.1x last week), led Tencent Holding’s (700-SEHK) 43.7x multiple (Figure 15). Twelve of the companies have P/E multiples under 10x. The median is just 12.4x.
  • 14. Page 14 P /E L T M (x) 50.0 43.7 45.0 40.0 37.4 37.5 35.6 35.0 30.0 27.3 25.9 26.0 25.0 22.8 23.1 19.9 20.3 20.0 A verage, 15.3 14.2 14.4 15.0 12.4 12.5 13.3 10.9 11.7 9.7 9.7 10.2 10.0 6.6 7.5 5.6 4.4 5.0 2.4 3.2 1.6 1.7 1.8 0.7 0.0 NE O W IZ G ames C orporation J umbuck E ntertainment P ty Ltd. G amania Digital E ntertainment C o., Ltd. C hines e G amer International Northgate T echnologies Limited DXN H oldings B hd C hangy ou.com Limited G iant Interactive G roup, Inc. G ameO n C o Ltd. Modern T imes G roup Mtg AB T he9 Limited Neteas e.com Inc. S handa Interactive E ntertainment Ltd. S NAP Interactive, Inc. Ngi G roup Inc. O pen T ex t C orp. C y berplex Inc. G igaMedia Ltd. S ohu.com Inc. NetDragon W ebS oft, Inc. S park Network s , Inc. IAC /InterActiveC orp. Worlds .com Inc. Mix i, Inc. T encent H oldings Ltd. XING AG P erfect World C o., Ltd. Y edangO nline C orp. K ings oft C o. Ltd. DADA S pA Actoz S oft C o., Ltd. Figure 15. P/E Ranking Source. Capital IQ P/E (LTM) by country/exchange: Figure 16 shows the average P/E multiples by stock exchange. The OTCBB has the largest number of companies (20), trading at an average multiple of 19.8x. On a geographic basis, the United States has the most companies (40), trading at an average of 18.4x earnings (Figure 17). Eleven of the companies are Canadian (average 17.8x EPS). Average P/E - By Exchange Average P/E - By Country 35.0 31.7 30.0 24.5 30.0 25.0 25.0 25.8 24.4 22.8 20.0 24.4 22.8 20.0 19.9 19.8 19.9 (x) 18.4 15.0 14.2 17.8 (x) 15.0 10.0 9.7 9.6 7.5 6.6 5.6 10.0 11.0 5.0 4.4 7.5 1.8 6.6 5.6 0.0 1.7 5.0 4.4 OTCBB GTSM SEHK KOSE TSE NasdaqGS CM OM XTRA AMEX TSX KLSE NYSE BSE ASX 0.0 1.7 Germany Japan United Canada China Malaysia India Italy South Korea States Taiwan Australia Sweden # Companies 2 3 7 2 5 20 2 4 14 1 2 1 1 1 1 # Companies 3 9 2 6 40 11 10 1 2 1 1 1 Figures 16 & 17. P/E Ranking (Exchange, Country) Source. Capital IQ
  • 15. Page 15 UPCOMING EVENTS E arnings C alendar C ompany Date & Time Quarter C onf C all Details G iant Interactive G roup, Inc. (NY S E : G A) T ues day, May 26, 2009 8: 00 AM (E DT ) Q 1 2009 800-573-4842 S handa Interactive E ntertainment L td. (Nas daqG S : S NDA) T ues day, J une 02, 2009 9: 00 P M (E DT ) Q 1 2009 1-800-299-0433 G igaMedia L td. (Nas daqG S : G IG M) T ues day, J une 09, 2009 8: 00 AM (E DT ) Q 1 2009 NA Figure 18. Earnings Calendar Source. Company reports
  • 16. Page 16 C omparable C ompany Analys is > Web 2.0 Pric e P erformanc e C ompany Name C urrenc y Tic ker E xc hange US D Market C ap ($m) C urrent P ric e 1 Wk 1 Mth 3 Mth 6 Mth 1 Yr 52 Week A ccelerize New Media, Inc. US D AC L Z OT C B B 14.4 0.52 4. 0% 6.1% 73.3% 30.0% -30. 7% -30.7% A ctoz S oft C o. , L td. KR W A052790 K OS E 149.0 21,750.00 45.0% 48.0% 98.6% 136.4% 148. 6% -4.2% A Q Interactive, Inc. JPY 3838 TS E 38.4 67,000.00 27.6% 42.3% 107.8% 102.4% -64. 4% -67.8% A s s ociated Media H oldings Inc. US D AS MH OT C P K 0.1 0.00 0. 0% 7.1% -70.0% -50.0% NM -97.0% B igs tring C orp. US D BSGC OT C B B 1.2 0.02 0. 0% 67.9% 64.3% 0. 0% -80. 8% -88.5% B eta wave C orpora tion US D B W AV OT C B B 2.6 0.09 -35.7% -35.7% -40.0% -57.1% -64. 0% -78.6% B eyond C ommerce, Inc. US D B Y OC OT C B B 51.0 1.15 -7.3% -32.4% 94.9% 9. 5% -48. 9% -65.2% B right T hings plc GB P AIM:B G T A IM 4.7 0.02 -14.3% -14.3% -9.1% 26.1% -46. 8% -46.8% B roadW ebA s ia Inc. US D BWBA OT C P K 25.3 0.30 -33.8% -33.8% -70.5% -77.9% -86. 8% -89.7% C DC C orp. US D C H IN.A Nas da qG S 151.7 1.43 11.7% 17.2% 74.4% 104.3% -56. 8% -59.0% C ha ngyou.com Limited US D C Y OU Nas da qG S 1, 595.6 29.01 -2.3% 10.8% NM NM NM -23.1% C hina G a tewa y C orporation US D CGWY OT C P K 0.0 0.00 100.0% 100.0% 0.0% -86.7% -96. 7% -95.6% C hines e G a mer International TWD G T S M:3083 GTS M 974.9 378.00 39.7% 75.8% 219.0% 369.6% 212. 4% 0.0% C ornerW orld C orpora tion US D CW R L OT C B B 5.8 0.09 -10.0% -35.7% -40.0% -55.0% -80. 0% -88.6% C yberplex Inc. C AD T S X: C X TS X 82.9 1.74 -0.6% 42.6% 397.1% 411.8% 104. 7% -12.6% DADA S pA E UR C M:DA CM 134.5 5.93 -3.3% 3.0% 8.2% -7.2% -59. 8% -62.1% DXN Holdings B hd MY R DXN K LS E 26.8 0.41 8. 0% 28.6% 28.6% 11.0% -6.9% -19.8% Dibz Interna tional, Inc. US D DIB Z OT C P K 0.0 0.00 -90.0% -90.0% -90.0% -98.0% -98. 0% -98.0% DigitalP os t Intera ctive, Inc. US D DG LP OT C B B 1.4 0.02 23.3% -2.6% 131.3% -53.8% -92. 0% -92.0% DigitalT own, Inc. US D DG T W OT C B B 35.2 1.30 -35.0% -35.0% -35.0% -35.0% -56. 7% -78.7% Dolphin Digital Media, Inc. US D DP DM OT C B B 35.1 0.68 -2.9% 36.0% 70.0% -9.3% NM -39.8% E olith C o. L td. KR W A041060 K OS E 48.6 840.00 -16.0% 10.5% 25.4% 66.3% -7.2% -27.6% E xtens ions , Inc. US D E XT I OT C P K 14.2 0.15 -25.0% -25.0% 185.7% 50.0% 0.0% -85.1% F inancia l Media G roup, Inc. US D F NG P OT C B B 0.3 0.00 -23.8% -36.0% -89.3% -95.4% -99. 5% -99.7% F luid Mus ic C anada, Inc. C AD T S X: F MN TS X 35.0 0.75 25.0% 114.3% 50.0% 150.0% NM -63.2% F rogs ter Intera ctive P ictures AG E UR FR G XT R A 26.2 7.95 -6.5% -9.5% 97.3% 94.4% 79.1% -19.7% G amania Digita l E ntertainment C o., L td. TWD 6180 GTS M 245.8 52.80 34.4% 64.2% 142.2% 319.0% 53.9% 0.0% G ameO n C o L td. JPY 3812 TS E 98.5 96,700.00 5. 3% 5.1% 5.1% -34.2% -29. 9% -40.9% G eoS entric Oyj E UR G E O1V H LS E 62.7 0.05 -16.7% 25.0% 66.7% 66.7% -28. 6% -28.6% G ia nt Interactive G roup, Inc. US D GA NY S E 1, 866.8 8.26 0. 2% 1.7% 35.9% 37.0% -38. 6% -44.5% G igaMedia L td. US D G IG M Nas da qG S 321.5 5.95 0. 2% -11.1% -6.0% 57.0% -65. 4% -66.8% G ra vity C o., Ltd US D GR VY Nas da qG M 32.8 1.18 20.4% 20.4% 68.6% 68.6% -15. 1% -40.7% G ree, Inc. JPY T S E :3632 TS E 1, 247.3 5,300.00 -3.5% -6.2% 18.0% NM NM -15.9% G ungH o Online E ntertainment, Inc. JPY 3765 OS E 187.1 155,000.00 -10.8% 21.4% 27.3% 49.2% -54. 7% -58.1% H anbitS oft, Inc. KR W A047080 K OS E 97.1 5,520.00 2. 4% 15.7% 72.0% 91.0% 22.3% -16.9% IAC /InterA ctiveC orp. US D IA C I Nas da qG S 2, 334.7 15.47 3. 5% -4.2% 2.8% 3. 6% -66. 8% -69.4% IAS E nergy, Inc. US D IA S C . A OT C B B 18.2 0.26 -1.9% 8.3% 1138. 1% 766.7% 13.0% -25.7% is eemedia Inc. C AD IE E T S XV 4.1 0.09 -10.0% -10.0% 12.5% 50.0% -61. 7% -74.3% J umbuck E ntertainment P ty Ltd. AU D AS X: J MB AS X 15.9 0.41 0. 0% -10.9% 0.0% -2.4% -26. 8% -37.4% J umpT V Inc. C AD T S X: J T V TS X 80.9 0.80 2. 6% 42.9% 105.1% 158.1% 23.1% -37.5% K aboos e Inc. C AD T S X: K AB TS X 75.9 0.61 1. 7% 3.4% 60.5% 103.3% -24. 7% -39.0% K ings oft C o. L td. HK D 3888 S E HK 783.0 5.62 18.1% 51.1% 108.9% 168.9% 48.7% -5.9% L ingo Media C orpora tion C AD T S XV :LM T S XV 12.0 1.05 -8.7% 16.7% 16.7% -11.0% -44. 4% -46.7% L iveW orld Inc. US D LV W D OT C P K 2.2 0.07 16.7% -30.0% 40.0% -22.2% -80. 0% -80.0% L ookS mart, L td. US D LO OK Nas da qG M 21.9 1.28 -1.5% -2.3% 2.4% 8. 0% -71. 2% -72.8% Ma gnitude Information S ys tems Inc. US D MAG Y OT C B B 4.6 0.01 0. 0% -33.3% -47.4% -16.7% -44. 4% -66.7% Mixi, Inc. JPY 2121 TS E 761.4 470,000.00 11.4% -2.7% 28.1% -17.3% -40. 9% -49.0% Modern T imes G roup Mtg AB SEK MT G B OM 1, 938.6 220.50 -4.5% 4.3% 89.3% 56.4% -47. 3% -48.2% Moggle, Inc US D MMOG OT C B B 83.5 2.30 15.0% 15.0% 53.3% NM NM 0.0% MO K O .mobi L imited AU D MK B AS X 4.1 0.06 -14.3% -29.4% 50.0% 50.0% 20.0% -40.0% Myriad G roup AG C HF MY R N S WX 118.0 6.00 9. 1% 37.9% 61.3% -11.8% -36. 2% -41.5% NE O W IZ G ames C orporation KR W A095660 K OS E 598.5 77,500.00 20.2% 32.7% 134.8% 358.6% 121. 1% -7.6% NetDra gon W ebS oft, Inc. HK D 777 S E HK 371.6 5.45 -4.4% 18.7% 101.1% 118.0% -47. 6% -53.0% Netea s e. com Inc. US D NT E S Nas da qG S 4, 030.0 32.75 7. 6% 9.4% 70.4% 106.0% 43.4% -2.7% NeXplore C orpora tion US D NXP C OT C P K 39.0 0.70 0. 0% -12.5% -26.3% -44.0% NM -51.7% Ngi G roup Inc. JPY 2497 TS E 44.3 34,000.00 11.7% -6.3% 90.1% -36.9% -76. 6% -78.6% Northgate T echnologies Limited INR 590057 BSE 27.3 37.00 -31.0% -19.0% 1.2% -35.1% -90. 9% -91.2% O pen T ext C orp. US D OT E X Nas da qG S 1, 657.6 31.50 1. 2% -8.5% -4.5% 21.5% -10. 0% -19.4% O penwa ve S ys tems Inc. US D OP W V Nas da qG S 149.1 1.79 49.2% 49.2% 103.4% 258.0% -6.3% -10.1% P erfect W orld C o., Ltd. US D PWRD Nas da qG S 1, 020.3 19.34 7. 3% 18.5% 51.1% 22.9% -23. 6% -31.1% P hotoC ha nnel Networks Inc. C AD T S XV :P N T S XV 52.0 1.71 0. 6% 3.6% -10.9% 47.4% -53. 9% -58.8% Q uepa s a C orp. US D QP S A Nas da qC M 12.2 0.96 -4.0% 1.1% -29.9% -55.1% -63. 1% -72.3% O AO R B C Information S ys tems US D R BCI R TS 173.4 1.25 26.9% 204.9% 346.4% -16.7% -85. 2% -86.3% S ha nda Interactive E nterta inment L td. US D S NDA Nas da qG S 3, 811.2 54.93 13.3% 22.7% 74.4% 141.3% 55.6% -2.5% S hutterfly, Inc. US D S F LY Nas da qG S 359.7 14.29 3. 9% 30.9% 83.4% 123.3% 10.2% -5.2% S K C ommunications C o. , L td. KR W A066270 K OS E 336.5 10,200.00 8. 5% 2.0% 55.5% 138.6% -32. 0% -48.2% S NA P Intera ctive, Inc. US D S TVI OT C B B 8.1 0.75 -6.3% 7.1% -25.0% 0. 5% 8.7% -30.6% S NM G loba l H oldings US D S NMN OT C P K 0.0 0.00 -16.7% 25.0% 150.0% -95.0% -99. 9% -99.9% S ocial Media V enures , Inc. US D S MV I OT C P K 0.0 0.01 -93.3% -99.2% -99.2% -99.7% NM -99.8% S ocialwis e, Inc. US D S CLW OT C B B 32.1 0.74 -15.9% 111.4% 60.9% -58.9% -21. 3% -73.9% S ohu.com Inc. US D S O HU Nas da qG S 2, 075.4 54.24 3. 2% 16.3% 20.1% 44.6% -30. 2% -40.7% S ites ea rch C orpora tion US D S TPC OT C B B 28.2 3.50 -30.0% NM NM NM NM -30.0% S pa rk Networks , Inc. US D LO V A ME X 46.3 2.25 -10.7% 0.9% -10.4% -26.0% -49. 1% -49.6% S pectrumDNA, Inc. US D S P XA OT C B B 19.5 0.40 17.6% 90.5% 300.0% 66.7% NM -33.3% T encent H oldings Ltd. HK D 700 S E HK 18,192. 6 78.25 -2.8% 18.7% 73.9% 100.6% 19.1% -5.9% T he P a rent C ompany US D K IDS . Q OT C P K 0.2 0.01 -47.4% -16.7% -60.0% -98.9% -99. 6% -99.7% T he9 L imited US D NC T Y Nas da qG S 240.6 8.97 -3.1% -6.2% -26.5% -17.9% -64. 1% -68.5% T heS treet.com, Inc. US D TS CM Nas da qG M 58.2 1.90 2. 7% -23.1% -12.8% -37.7% -74. 7% -75.8% T ota l S port Online A S NO K T OS O O T C NO 0.1 0.03 0. 0% 0.0% -25.0% -40.0% -70. 0% -70.0% T ree.C om, Inc. US D TR E E Nas da qG M 131.7 12.20 3. 7% 114.0% 199.8% 444.6% NM -6.7% U nis erve C ommunica tions C orp. C AD T S XV :US S T S XV 1.1 0.05 25.0% 25.0% -37.5% -72.2% -85. 7% -85.7% U nited O nline Inc. US D UNT D Nas da qG S 548.3 6.56 -0.9% 37.0% 45.1% 17.8% -46. 4% -47.5% U OMO Media, Inc US D UO MO OT C B B 28.3 0.33 -5.7% 312.5% 312.5% 112.9% -32. 7% -68.9% V alueC lick Inc. US D V CLK Nas da qG S 872.3 10.03 -0.5% 1.6% 62.3% 82.7% -48. 9% -50.6% V OIS , Inc. US D V O IS OT C B B 7.5 0.90 181.3% 200.0% 20.0% 20.0% NM -83.9% W ebzen Inc. US D W ZE N Nas da qG M 53.8 4.53 45.8% 64.3% 312.2% 504.5% 31.0% -1.2% W izzard S oftwa re C orporation US D W ZE A ME X 27.2 0.57 -12.3% -5.0% -1.7% -13.6% -73. 5% -74.6% W orlds .com Inc. US D W DDD OT C B B 7.9 0.15 -11.8% -11.8% 25.0% 7. 1% -57. 1% -62.5% W ynds torm C orpora tion US D W Y ND OT C B B 9.2 0.51 1600.0% 200.0% 325.0% 325.0% -15. 0% -40.0% XING A G E UR O1B C XT R A 240.4 32.56 5. 9% 8.6% 8.5% 32.1% -17. 2% -24.4% Y eda ngOnline C orp. KR W A052770 K OS E 136.0 10,800.00 3. 3% 11.7% 71.4% 74.5% -8.5% -13.9% Y nk K orea Inc. KR W A023770 K OS E 15.6 7,910.00 2. 7% 68.3% 105.5% 42.8% -42. 1% -46.9% ZipLocal Inc. C AD T S XV :ZIP T S XV 0.7 0.01 100.0% 100.0% 100.0% -33.3% -93. 3% -94.1% H igh 1600.0% 312.5% 1138. 1% 766.7% 212. 4% 0.0% L ow -93.3% -99.2% -99.2% -99.7% -99. 9% -99.9% Average 530.5 20.3% 22.3% 70.0% 59.6% -29.1% -50.3% Media n 0. 0% 8.5% 50.0% 22.9% -44. 4% -48.2% Figure 19. Price Performance Source. Capital IQ
  • 17. Page 17 C omparable C ompany Analys is > Web 2.0 Valuation Multiples P rimary US D Market TE V/L TM TE V/ NTM TE V/L TM TE V/NTM C ompany Name S ec tor C ountry E xc hange Ticker C ap ($m) R evenue R evenue E B ITDA E B ITDA P /L TM E P S P /NTM E P S P /TangB V Accelerize New Media, Inc. Direct Marketing U nited S ta tes OTCB B AC LZ 14.4 4.7x - - - - - - Actoz S oft C o., Ltd. G aming S outh K orea K OS E A052790 149.0 1.6x - 8. 1x - 23.1x - 2.6x AQ Intera ctive, Inc. G aming J apan TS E 3838 38.4 0.1x - 1. 6x - - - 0.6x As s ocia ted Media Holdings Inc. Mobile U nited S ta tes OTCP K AS MH 0.1 8.1x - - - - - - B igs tring C orp. Ins ta nt Mes s aging U nited S ta tes OTCB B BSGC 1.2 31.7x - - - - - - B etawave C orpora tion Media U nited S ta tes OTCB B B W AV 2.6 - - - - - - 0.4x B eyond C ommerce, Inc. S ocial Networking U nited S ta tes OTCB B B YOC 51.0 7.8x - - - - - - B right T hings plc S ocial Networking U nited K ingdom AIM AIM:B G T 4.7 17.6x - - - - - - B roadW ebAs ia Inc. S ocial Networking U nited S ta tes OTCP K BWBA 25.3 - - - - - - - C DC C orp. G aming H ong K ong N as da qG S C HIN.A 151.7 0.4x 0.4x 5. 4x 5.8x - 10.4x - C hangyou.com Limited G aming C hina N as da qG S C Y OU 1,595.6 6.3x 4.8x 10.4x - 10.9x - 9.9x C hina G atewa y C orpora tion Mobile U nited S ta tes OTCP K CGW Y 0.0 0.0x - - - - - - C hines e G amer Interna tional G aming T a iwa n GTS M G T S M:3083 974.9 16.0x - 28.6x - 37.4x - 14.1x C ornerW orld C orporation C ontent U nited S ta tes OTCB B CW R L 5.8 5.5x - - - - - - C yberplex Inc. A dvertis ing C ana da TS X T S X: C X 82.9 1.1x 0.8x 10.5x 7.0x 9.7x 10.4x 9.7x DA DA S pA S ocial Networking Italy CM C M:DA 134.5 0.8x - 4. 9x - 7.5x - - DXN Holdings B hd S ocial Networking Mala ys ia K LS E DXN 26.8 0.5x - 3. 9x - 4.4x - 0.5x Dibz Interna tiona l, Inc. S NS Apps U nited S ta tes OTCP K DIB Z 0.0 - - - - - - - DigitalP os t Interactive, Inc. C ontent U nited S ta tes OTCB B DG L P 1.4 5.6x - - - - - - DigitalT own, Inc. S ocial Networking U nited S ta tes OTCB B DG T W 35.2 - - - - - - - Dolphin Digital Media, Inc. S ocial Networking U nited S ta tes OTCB B DP DM 35.1 46.8x - - - - - - E olith C o. L td. G aming S outh K orea K OS E A041060 48.6 3.4x - - - - - 4.6x E xtens ions , Inc. C ontent U nited S ta tes OTCP K E XT I 14.2 - - - - - - - F inancial Media G roup, Inc. Direct Marketing U nited S ta tes OTCB B F NG P 0.3 - - - - - - - F luid Mus ic C a nada, Inc. Media U nited S ta tes TS X T S X:F MN 35.0 5.3x 4.1x - - - - 3.1x F rogs ter Interactive P ictures A G G aming G erma ny XT R A FR G 26.2 4.6x - - - - - 2.3x G amania Digital E ntertainment C o., Ltd. G aming T a iwa n GTS M 6180 245.8 1.8x - 10.5x - 26.0x - 3.2x G ameO n C o Ltd. G aming J apan TS E 3812 98.5 0.5x - 2. 0x - 9.7x - 1.3x G eoS entric Oyj Mobile F inland H LS E G E O1V 62.7 8.9x - - - - - 6.1x G iant Interactive G roup, Inc. G aming C hina NY S E GA 1,866.8 - - - - 1.8x 13.5x 0.4x G igaMedia Ltd. G aming T a iwa n N as da qG S G IG M 321.5 1.3x 1.3x 5. 3x 5.9x 10.2x 10.5x 2.9x G ravity C o., Ltd G aming S outh K orea N as da qG M GR VY 32.8 - - - - - - - G ree, Inc. S ocial Networking J apan TS E T S E : 3632 1,247.3 37.6x - - - - - 15.4x G ungH o O nline E nterta inment, Inc. Media J apan OS E 3765 187.1 1.4x - 7. 8x - - - - Ha nbitS oft, Inc. G aming S outh K orea K OS E A047080 97.1 1.4x - - - - - 3.0x IAC /InterActiveC orp. Media U nited S ta tes N as da qG S IAC I 2,334.7 0.3x - 10.5x - 19.9x 30.5x 1.0x IAS E nergy, Inc. V ideo C ana da OTCB B IAS C .A 18.2 - - - - - - - is eemedia Inc. C ontent C ana da T S XV IE E 4.1 1.8x - - - - - 2.1x J umbuck E ntertainment P ty L td. S ocial Networking Aus tra lia AS X AS X:J MB 15.9 0.8x - 2. 1x - 6.6x - 1.6x J umpT V Inc. V ideo C ana da TS X T S X:J T V 80.9 4.7x - - - - - 4.1x K a boos e Inc. C ontent C ana da TS X T S X:K AB 75.9 1.1x 1.1x 9. 3x 5.7x - - - K ings oft C o. Ltd. G aming C hina S E HK 3888 783.0 6.2x - 15.9x - 20.3x - 4.7x Lingo Media C orpora tion L earning C ana da T S XV T S XV : LM 12.0 11.6x - - - - - 9.3x LiveW orld Inc. S ocial Networking U nited S ta tes OTCP K LV W D 2.2 0.1x - - - - - 0.9x LookS ma rt, L td. Direct Marketing U nited S ta tes N as da qG M L OOK 21.9 - - - - - - 0.8x Magnitude Information S ys tems Inc. S ocial Networking U nited S ta tes OTCB B MA G Y 4.6 - - - - - - - Mixi, Inc. S ocial Networking J apan TS E 2121 761.4 5.1x - 14.3x - 37.5x - 5.6x Modern T imes G roup Mtg AB Media S weden OM MT G B 1,938.6 1.4x 1.4x 9. 1x 11.0x 5.6x 12.8x - Moggle, Inc G aming U nited S ta tes OTCB B MMO G 83.5 - - - - - - - MOK O .mobi Limited S ocial Networking Aus tra lia AS X MK B 4.1 2.6x - - - - - 3.1x Myriad G roup AG Mobile S witzerla nd SWX MY R N 118.0 3.3x - - - - - 5.3x NE OW IZ G ames C orporation G aming S outh K orea K OS E A095660 598.5 3.0x - 11.0x - 35.6x - 18.0x NetDra gon W ebS oft, Inc. G aming C hina S E HK 777 371.6 2.7x - 6. 8x - 13.3x - 2.0x Netea s e.com Inc. G aming C hina N as da qG S NT E S 4,030.0 - - - - 2.4x 14.7x 0.7x NeXplore C orporation C ontent U nited S ta tes OTCP K NXP C 39.0 - - - - - - - Ngi G roup Inc. Media J apan TS E 2497 44.3 - - - - 12.5x - 0.7x Northgate T echnologies Limited Direct Marketing India BS E 590057 27.3 0.2x - 1. 1x - 1.7x - - O pen T ext C orp. C ollabora tion C ana da N as da qG S OT E X 1,657.6 2.2x 2.0x 8. 7x 7.5x 25.9x - - O penwave S ys tems Inc. Mobile U nited S ta tes N as da qG S OP W V 149.1 0.2x 0.2x - 2.6x - 28.9x 2.1x P erfect W orld C o., Ltd. G aming C hina N as da qG S PWRD 1,020.3 - - - - 1.6x 8.7x 0.6x P hotoC hannel Networks Inc. Digita l Ima ging C ana da T S XV T S XV :P N 52.0 2.6x 1.8x - 5.4x - 11.5x 21.5x Q uepa s a C orp. S ocial Networking U nited S ta tes N as da qC M QP S A 12.2 - - - - - - - O AO R B C Information S ys tems Media R us s ia R TS R BCI 173.4 0.0x - 0. 3x - - - - S handa Interactive E nterta inment Ltd. G aming C hina N as da qG S S NDA 3,811.2 0.3x 1.5x 0. 6x 3.3x 3.2x 17.4x 1.5x S hutterfly, Inc. Digita l Ima ging U nited S ta tes N as da qG S S FLY 359.7 1.4x - 10.4x 7.9x - 99.2x 2.1x S K C ommunications C o., Ltd. S earch S outh K orea K OS E A066270 336.5 1.8x - 28.0x - - - - S N AP Interactive, Inc. Dating U nited S ta tes OTCB B S TVI 8.1 2.0x - 7. 2x - 12.4x - 4.8x S N M G lobal Holdings Media U nited S ta tes OTCP K S NMN 0.0 1.1x - - - - - - S ocial Media V enures , Inc. S ocial Networking U nited S ta tes OTCP K S MV I 0.0 0.0x - - - - - - S ocialwis e, Inc. S ocial Networking U nited S ta tes OTCB B S CLW 32.1 - - - - - - 41.7x S ohu.com Inc. G aming C hina N as da qG S S O HU 2,075.4 3.7x 3.2x 8. 5x 7.4x 11.7x 14.9x 5.6x S ites ea rch C orpora tion S ocial Networking U nited S ta tes OTCB B S TPC 28.2 - - - - - - 40.1x S park N etworks , Inc. S ocial Networking U nited S ta tes AME X L OV 46.3 0.9x - 4. 0x - 14.2x - - S pectrumDN A, Inc. Media U nited S ta tes OTCB B S P XA 19.5 - - - - - - 51.0x T encent Holdings Ltd. P orta l C hina S E HK 700 18,192.6 16.4x - 34.1x - 43.7x - 18.3x T he P a rent C ompany Media U nited S ta tes OTCP K K IDS .Q 0.2 0.2x - - - - - - T he9 L imited G aming C hina N as da qG S NC T Y 240.6 - - - - 0.7x 9.8x 0.1x T heS treet.com, Inc. Media U nited S ta tes N as da qG M TS CM 58.2 - - - - - - 0.7x T otal S port Online AS Media N orway O T C NO T OS O 0.1 4.6x - - - - - - T ree.C om, Inc. P orta l U nited S ta tes N as da qG M TREE 131.7 0.6x 0.5x - 6.5x - - 1.7x Unis erve C ommunications C orp. S ocial Networking C ana da T S XV T S XV :US S 1.1 0.2x - - - - - - United Online Inc. Media U nited S ta tes N as da qG S U NT D 548.3 1.0x 0.8x 4. 7x 3.4x - 9.1x - UO MO Media, Inc Media C ana da OTCB B UO MO 28.3 45.0x - - - - - - V a lueC lick Inc. Media U nited S ta tes N as da qG S V CLK 872.3 1.3x 1.4x 7. 3x 5.6x - 15.9x 7.1x V O IS , Inc. S ocial Networking U nited S ta tes OTCB B V OIS 7.5 - - - - - - 16.9x W ebzen Inc. G aming S outh K orea N as da qG M W ZE N 53.8 - - - - - - 0.0x W izzard S oftware C orporation P odca s ting U nited S ta tes AME X W ZE 27.2 4.5x - - - - - - W orlds .com Inc. C ontent U nited S ta tes OTCB B W DDD 7.9 - - - - 27.3x - - W ynds torm C orporation C ontent U nited S ta tes OTCB B W Y ND 9.2 - - - - - - - XIN G AG S ocial Networking G erma ny XT R A O1B C 240.4 3.6x - 11.4x - 22.8x - 7.8x Y eda ngO nline C orp. G aming S outh K orea K OS E A052770 136.0 2.5x - 11.0x - 14.4x - 6.7x Y nk K orea Inc. G aming S outh K orea K OS E A023770 15.6 1.0x - - - - - - ZipLocal Inc. Directory C ana da T S XV T S XV :ZIP 0.7 0.7x - - - - - - High 18,192.6 46.8x 4.8x 34.1x 11.0x 43.7x 99.2x 51.0x Low 0.0 0.0x 0.2x 0. 3x 2.6x 0.7x 8.7x 0.0x Average 530.5 5.4x 1.7x 9.3x 6.1x 15.3x 19.9x 7.3x Median 44.3 1.8x 1.4x 8. 3x 5.8x 12.4x 13.1x 3.1x Figure 20. Valuation Comparison Source. Capital IQ
  • 18. Page 18 C omparable C ompany Analys is > Web 2.0 S ummary by C ountry C ompany Name US D Market C ap ($m) Avg US D Market C ap ($m) US D L TM Total R ev ($m) US D L TM Total E B ITDA ($m) E B ITDA % United S tates 40 C hina 33, 987. 1 C hina 3,398. 7 C hina 3,800. 9 C hina 1, 894. 0 C hina 49. 2% C a na da 11 U nited S ta tes 5, 025. 1 S weden 1,938. 6 United S tates 3,795. 9 S weden 275. 1 A us tralia 37. 2% C hina 10 J a pan 2, 376. 9 T aiwan 514. 1 S weden 1,796. 0 United S tates 240. 3 T aiwan 32. 3% S outh K orea 9 C anada 2, 013. 9 J apan 396. 2 C a na da 989. 9 C a na da 196. 3 J apan 25. 7% J a pa n 6 S weden 1, 938. 6 C anada 183. 1 S outh K orea 661. 8 J a pa n 134. 6 India 17. 6% T a iwa n 3 T a iwa n 1, 542. 2 R us s ia 173. 4 J a pa n 522. 2 T a iwa n 98. 9 Italy 16. 0% Aus tralia 2 S outh K orea 1, 467. 8 S outh K orea 163. 1 Hong K ong 389. 9 S outh K orea 79. 3 S weden 15. 3% G erma ny 2 G ermany 266. 5 Hong K ong 151. 7 T a iwa n 374. 1 Ita ly 37. 9 Mala ys ia 13. 7% S witzerla nd 1 R us s ia 173. 4 Ita ly 134. 5 Ita ly 237. 4 Hong K ong 30. 8 R us s ia 13. 1% Hong K ong 1 Hong K ong 151. 7 G ermany 133. 3 R us s ia 152. 8 India 25. 1 Hong K ong 7. 9% F inla nd 1 Ita ly 134. 5 U nited S ta tes 125. 6 India 142. 5 R us s ia 20. 0 S outh K orea 3. 7% Ita ly 1 S witzerla nd 118. 0 S witzerla nd 118. 0 Ma lays ia 79. 3 G erma ny 13. 1 S witzerla nd 1. 9% United K ingdom 1 F inland 62. 7 F inland 62. 7 G erma ny 58. 7 Ma lays ia 10. 9 U nited S ta tes -10. 6% India 1 India 27. 3 India 27. 3 S witzerla nd 40. 0 Aus tralia 2. 9 C anada -12. 9% S weden 1 Malays ia 26. 8 Malays ia 26. 8 Aus tralia 15. 1 S witzerla nd 0. 8 G ermany -14. 7% R us s ia 1 Aus tralia 20. 0 Aus tralia 10. 0 F inla nd 6. 1 Norwa y -1. 1 Norway -50. 6% Ma lays ia 1 U nited K ingdom 4. 7 U nited K ingdom 4. 7 Norwa y 2. 1 United K ingdom -1. 8 U nited K ingdom NA Norwa y 1 Norway 0. 1 Norway 0. 1 United K ingdom 0. 3 F inla nd -13. 8 F inland NA G rand Total 93 G rand Total 49,337.2 G rand Total 530.5 G rand Total 13,064.8 G rand Total 3,043.3 G rand Total 8.7% Figure 21. Comparison by Country Source. Capital IQ C omparable C ompany Analys is > Web 2.0 S ummary by E xc hange C ompany Name US D Market C ap ($m) Avg US D Market C ap ($m) US D L TM Total R ev ($m) US D L TM Total E B ITDA ($m) E B ITDA % OT C B B 20 S E HK 19, 347. 3 S E HK 6,449. 1 OM 1,796. 0 Na s daqG S 1, 718. 7 NY S E 61. 9% Na s daqG S 14 Nas da qG S 19, 167. 9 OM 1,938. 6 Na s daqG S 481. 4 S E HK 658. 4 S E HK 42. 1% OT C P K 10 TS E 2, 189. 8 NY S E 1,866. 8 S E HK 470. 8 OM 275. 1 AS X 37. 2% K OS E 7 OM 1, 938. 6 Nas da qG S 1,369. 1 CM 237. 4 NY S E 144. 6 GTS M 36. 3% TS E 5 NY S E 1, 866. 8 GTS M 610. 3 NY S E 233. 6 TS E 113. 5 Nas da qG S 29. 7% Na s daqG M 5 K OS E 1, 381. 3 TSE 438. 0 RTS 152. 8 K OS E 72. 2 TSE 27. 2% T S XV 5 GTS M 1, 220. 7 K OS E 197. 3 BSE 142. 5 GTS M 52. 8 OS E 17. 8% TS X 4 OT C B B 394. 0 OS E 187. 1 OS E 118. 5 CM 37. 9 BSE 17. 6% S E HK 3 Nas da qG M 298. 3 R TS 173. 4 GTS M 91. 9 BSE 25. 1 CM 16. 0% AME X 2 TS X 274. 8 CM 134. 5 K OS E 85. 6 OS E 21. 1 OM 15. 3% XT R A 2 XT R A 266. 5 XT R A 133. 3 Na s daqG M 81. 1 RTS 20. 0 K LS E 13. 7% AS X 2 OS E 187. 1 SWX 118. 0 TS E 80. 7 XT R A 13. 1 R TS 13. 1% GTS M 2 R TS 173. 4 TSX 68. 7 K LS E 79. 3 K LS E 10. 9 K OS E 2. 3% SWX 1 CM 134. 5 HLS E 62. 7 TS X 40. 9 AME X 5. 8 S WX 1. 9% HL S E 1 SWX 118. 0 Nas da qG M 59. 7 SWX 40. 0 AS X 2. 9 Nas da qG M 1. 6% NY S E 1 OT C P K 81. 0 AME X 36. 8 AME X 30. 2 SWX 0. 8 T S XV 1. 3% CM 1 AME X 73. 5 BS E 27. 3 XT R A 29. 3 OT C NO -1. 1 OTCB B -5. 3% BS E 1 T S XV 70. 0 K LS E 26. 8 OT C P K 19. 0 TS X -1. 5 TSX -13. 5% Na s daqC M 1 HLS E 62. 7 OT C B B 19. 7 T S XV 9. 5 AIM -1. 8 XT R A -14. 7% OS E 1 BS E 27. 3 T S XV 14. 0 AS X 7. 6 Na s daqG M -8. 0 A ME X -38. 3% AIM 1 K LS E 26. 8 Nas da qC M 12. 2 HL S E 6. 1 T S XV -9. 3 OTCP K -42. 1% OM 1 AS X 20. 0 AS X 10. 0 OT C NO 2. 1 Na s daqC M -10. 8 O T C NO -50. 6% RTS 1 Nas da qC M 12. 2 OT C P K 8. 1 OT C B B 2. 1 HL S E -13. 8 HLS E NA K LS E 1 AIM 4. 7 AIM 4. 7 AIM 0. 3 OT C P K -33. 1 A IM NA OT C NO 1 OT C NO 0. 1 OT C NO 0. 1 Na s daqC M 0. 1 OT C B B -50. 1 Nas da qC M NA G rand Total 93 G rand Total 49,337.2 G rand Total 530.5 G rand Total 13,064.8 G rand Total 3,043.3 G rand Total 8.7% Figure 22. Comparison by Exchange Source. Capital IQ
  • 19. Page 19 F inanc ing - L as t Three Months (US $ m) Month C ompany Name C ountry Angel/S eed Debt financ ing P IPE S eries A S eries B S eries C S eries D S eries E G rand Total Mar-09 K aixin001.c om C hina 20. 0 20. 0 Vidyo US A 15. 0 15. 0 B uzznet US A 12. 5 12. 5 L endingC lub US A 12. 0 12. 0 S endMe Inc . US A 12. 0 12. 0 Auditude US A 10. 5 10. 5 G lam Media US A 10. 0 10. 0 Vis ible Meas ures US A 10. 0 10. 0 S uperS ecret US A 10. 0 10. 0 G oViral UK 8. 8 8. 8 G reys tripe US A 5. 5 5. 5 OMG P OP US A 5. 0 5. 0 Apture US A 4. 1 4. 1 S imulmedia US A 4. 0 4. 0 Tynt C a na da 3. 9 3. 9 AnyS ourc e Media US A 3. 2 3. 2 Pixazza US A 3. 1 3. 1 B it.ly US A 2. 0 2. 0 Hunc h US A 2. 0 2. 0 S ports C ompos ite DE US A 2. 0 2. 0 AdultS pac e US A 1.3 1. 3 Myngle Netherla nds 1. 3 1. 3 33Ac ros s US A 0. 8 0. 8 Three Melons Argentina 0. 6 0. 6 Mar-09 Total 1.3 1.3 0.6 41.1 50.3 43.0 12.0 10.0 159.5 Apr-09 C ollec tive Media US A 20. 0 20. 0 G OOM R adio F ra nce 16. 0 16. 0 Marin S oftware US A 13. 0 13. 0 The R ubic on P roject US A 8. 0 5. 0 13. 0 F reeW heel US A 12. 0 12. 0 C ellufun US A 10. 0 10. 0 C onduc tor Inc . US A 10. 0 10. 0 S c anS c out US A 8.1 8. 1 Viximo US A 5.0 5. 0 DoubleTwis t US A 5. 0 5. 0 IMS hopping US A 4. 7 4. 7 S oc ialtext US A 4. 5 4. 5 Mixerc as t US A 4. 1 4. 1 S oundC loud G erma ny 3. 3 3. 3 TubeMogul US A 3. 0 3. 0 Tribal Nova C a na da 2. 5 2. 5 Tripbas e US A 2. 0 2. 0 S oc ialc as t US A 1. 4 1. 4 B randtology S inga pore 1. 4 1. 4 S c an & Target F ra nce 1.3 1. 3 J odange US A 1.2 1. 2 F oodis ta US A 0. 6 0. 6 Apr-09 Total 15.6 8.0 45.3 52.5 16.1 12.0 149.5 May-09 One Net E ntertainment C hina 10. 0 10.0 20. 0 C yberplex C a na da 12.9 12. 9 Imeem US A 8.8 8. 8 E veryZing US A 8. 3 8. 3 B logHer Inc . US A 7. 0 7. 0 G is t US A 6. 8 6. 8 F uhu Inc . US A 6. 3 6. 3 Azuki S ys tems US A 6. 0 6. 0 I L ove R ewards C a na da 5. 9 5. 9 TimeB ridge US A 5. 0 5. 0 Doc uS ign US A 5. 0 5. 0 OL X US A 5. 0 5. 0 Medialets US A 4.0 4. 0 R es onate Networks US A 2. 0 2. 0 VoxP op US A 1. 5 1. 5 Mo'Minis Is ra el 1. 5 1. 5 L oop'd Network US A 0.8 0. 8 May-09 Total 13.6 10.0 22.9 16.3 18.7 20.3 5.0 106.6 G rand Total 30.5 19.3 23.5 102.7 121.4 79.4 29.0 10.0 415.6 Figure 23. Financing, Last Three Months Source. Company reports
  • 20. Page 20 C ompany Des c riptio ns - C urrent Mo nth C apital Market A c tivity C ompany HQ W ebs ite Des criptio n A zuki s ys tem s U nited S ta tes www. azuk is ys tems .com P eerMeta provides web-e na bled mobile devic es a nd s ervices . The c ompa ny dev elops applic ations around iG oogle, F a c ebook, M yS pac e a nd Y ahoo. P eerM eta is bas ed in B oston, M a ss a chus etts . B logHer, In c . U nited S ta tes www. blogher. com B logHer I nc. operates a n online community a nd media network for women. I t offers a s eries of live ev ents a nd conferenc es, as well a s an a dvertising network of blog a ffilia tes. The company ha s a stra tegic-partnership with iV illa ge. B logHer I nc. wa s founded in 2005 and is bas ed in R edwood C ity, Ca lifornia. C yberplex C a nada www. cyberplex. com C y berplex Inc . provid es W eb a dv ertis ing s olutions a nd on-line c ustomer ac quisition strategies for F ortune 1000 compa nies a nd s mall to mid- siz ed bus ines ses in C anada a nd the Uni ted S ta tes . Its W eb A dvertising divis ion provides performance-ba s ed I nte rnet advertising s olutions to a cquire leads , drive sign-ups , downloa ds, inquirie s, or a cquire payi ng customers. T he c ompa ny’s T ec hnology S ervic es div ision compris es ma na gement and technology c onsu ltants to a s sis t clients in the a rea s of a pplica tions lifecy cle; and re-engineering a nd optimization of tec hnologies , developing a nd delivering a pplica tions us ing the productions a nd tec hnologies, a nd monito ri ng a nd supporting ap plications to ensure performa nce a nd reliability. C yberplex a ls o prov ides technology s olutions, s uc h a s s ys tem integra tion, enterprise c ontent ma na gement, data ma nagement a nd reporting, W eb content management, bus iness proces s ma na gement, enterprise s earch, a nd spec ial enga gement offerings; a nd W eb design s olutions , which include pre-designed, cus tom designed, an d ecommerce s olutions. I t s erves a dvertisers , publis hers, and agenc ies. The compa ny wa s formerly k nown a s NewP ath Ca pita l C orpora tion a nd cha nged its name to C yberplex Docu S ign U nited S ta tes www. doc usign. com Doc uS ign, I nc. p rov ides s oftwa re services for electronic s igna ture and electronic c ontra c t executi on (E C E ). It offers P rofess ional E d ition, which ena bles individua ls and bus iness es to s end their documents for signa ture; C orpora te E dition, a n elec tronic signature a nd c ontrac t execution s olution tha t a u toma tes the proces s of manua lly s ending, si gning, tra c ki ng, a nd s toring doc uments ; a nd D ocuS i gn C onnect, a suite of integration services to extend D ocuS ign P la tform ca pa bilities into exis ting s ys tems or new a pplica tions . The compa ny a ls o provides C onnec t for S ales forc e, which ena bles us ers to s end doc umen ts ; ca pture contra ct and env elope da ta ; view va rious contra ct s tatus a nd data in the dashboard tab enabling vis ibility into va rious contra ct ac tiv ity a cros s the entire orga niz a tion; a nd extent form data prov ided during the signing proc ess by a utoma tica lly injecting it into S a les force O bjects eliminating the need to rek ey data . I t s erves indus tries, s uc h as a griculture, bio-technology , bus iness s ervices , co nstruction, c onsulting, consumer electronics , debt s ettlement, educa tion, engineering, fina nc ia l services ga ming, gov ernment, hardwa re, healthc are, ins ura nce, lea sing, ma nufa cturing, mining, mortga ge, non-profit pharmac eutica l E veryZing U nited S ta tes www. every zing. com E very Zing C orp. is a podc as t sea rc h engine tha t lets the user s ea rch a udio of both a udio and video podca sts. The company wa s founded in 2006 as P odZinger Corp. a nd changed its na me to E veryZ ing C orp. in 2007. E veryZ ing is bas ed in C a mbridg e, Ma s sa chus etts. E veryZ ing C orp. is a s ubsidia ry of B B NT S olutions , LL C . F UH U U nited S ta tes www. fuhu.c om F U HU produc es v irtua l identity c ards a nd rich media web widgets . F U HU ’s miss ion is to give us ers control over their stuff (photos , content, identity, email a ddres ses ) by ma k ing it u nivers a lly a cc es sible, s ha reable a nd ma na gea ble a nywhere, anytime. G is t U nited S ta tes www. gis tworld.c om G ist L td. prov ides s upply cha in s olutions for grocery , retail, elec tronics , ga s , and chemica l indus tries . It offers s trategic sup ply chain trans formation, s upply cha in planning, bus iness modeling, network design, wa rehouse s olutions , and distribution s olutions . T he c ompa ny a lso provide s inbound a nd outbound mana gement; network opera tions , such a s network design a nd optimiza tion, s oluti on deliv ery, s upply cha in opera tions, and prima ry distribution; cus tomer fulfilment, which inc ludes phys ic al replenis hment, rev erse logis tic s, and va lue-add services ; and cha nge management. T he company wa s formerly known a s B OC Dis tribution S ervices Limited and changed its na me to G ist L td. in J une, 2001. T he compa ny wa s inc orpora ted in 1951 and is hea dqua rtered in B a sings toke, U nited K ingdom. I t has opera tions in E urope, As ia, Aus tra la s ia, a nd North America . G ist L td. opera tes as a subs idia ry of T he B O C G roup L td. Imeem U nited S ta tes www. imeem. c om Imeem, I nc. opera tes as a n online communi ty for mus icia ns , direc tors , photogra phers, and groups. It ena bles users to c reate a udio, video, a nd photo pla ylis ts ; s ha re their fa vorites ; disc over new c ontent; tra ck their films; crea te a nd view pla y lists of their fav orite shots; tra ck their photos ; s ha re a lbums with their fri ends; hold group di sc uss ions ; cha nge their profile info; uploa d new photo albums; pos t new v ideos, or mu sic ; and write blogs , or comments . The compa ny wa s founded in 2004 is ba s ed in S an F ra ncis co, C a liforn ia. I Love R ewards C a nada www. iloverewards. c om I Love R ewards, Inc ., an inc entiv e mark eting compa ny , engages in the design, development, a nd implementa tion of incentive s olutions for companies and bus iness es in the United S ta tes a nd C a na da. I t offers online rewards a nd employee recognition, s ales incentiv es, c us tomer loya lty, dea ler inc entiv es, not for profit, a nd cus tom solutions . The c ompany prov ides its solutions through a W eb-ba s ed engine a nd foc uses on employ ee moti va tion, cus tomer loya lty, and va lued beha viors. I L ove R ewa rds, I nc. was founded in 1995 a nd is bas ed in T oronto, C ana da with a n additional offic e in N ew Y ork, the United S ta te s. Medialets U nited S ta tes www. media lets . com Media lets is a creative a dv ertis ing network for na tiv e mobile a pplications . L a unched on J uly 11th, 2008, M edia lets works with a gencies, bra nds and application dev elopers to define a nd deploy a d formats tha t tap into a ll of the ca pabili ties of the iP hone. Medialy tics , Medialets ’ free a nalytic s and reporting solution, is the leading analy tics a nd a d vertising solution for the world’s mos t downloaded iP hone a pplica tions . Media lets is a privately-held compa ny with offic es in N ew Y ork , NY a nd S a n F rancis c o, C A Mo 'Min is I s ra el www. momini s. com Mo’M inis platform allows a dva nced a s well as non-s killed developers to ra pidly create origina l qua lity ga mes from sc ra tc h, without the need of programming, a nd ha ve them s ea mles s ly supported on a wide ra nge of mobile ha ndsets . F urthermore, developers ca n colla bora te, share game a s sets with Mo’M inis developers ’ c ommunity members and enjoy monetiza tion through Mo’M inis va rious dis tribution cha nnel s. OL X U nited S ta tes www. olx. c om O L X , Inc. opera tes a c la s sified site. Its s ite a llow us ers to sea rc h for sale produc ts , inc luding anima ls , babies, a rt products, books , ca meras , C D s, cell phones, clothes, computers , D V Ds , electronic s, hea lth a nd bea uty products , home produc ts , jewelry, musi ca l instruments , s porting goods, tic kets , toy s, a nd v ideo games, a s well as c ars, ca r pa rts , boats , motorc ycles , a nd other vehic les. T he compa ny’s site a ls o enables users to find a cc ounts, a dv erti sing, a rts, clerica l, customer s ervice, educ ation, engineering, hea lthc are, human res ource, Internet, legal, ma nua l la bor, ma nufa cturing, ma rketing, non-profit, rea l es tate, restaura nt, reta il, s ales , a nd tec hnical jobs ; and s ea rch for v arious serv ic es, suc h as babys itter, c a sting, ev ent, computer, hea lth, horos copes , moving, repa ir, writing, editing, and transla ting, a s well a s find personals ; community ac tivities; computer, la ngua ge, music , a nd tutor class es ; a nd a pa rtments , offices, a nd park ing s pots. O L X wa s founded in 2006 a nd is ba sed in N ew Y ork , New Y ork . R es on ate Netwo rks U nited S ta tes www. res onatenetwork s. com R es ona te N etwo rk s is a n online advertising network tha t wa s crea ted to help public a ffa irs , political and corpora te adv ertis ers a nd a gencies mo re prec isely target and reach web users , bas ed on thei r a ttitudes and iss ue pos itions on a wide range of topic s . T im eBridge U nited S ta tes www. timebridge. c om Timebridge, I nc. offers person al s cheduling ma na ger that ena bles profess iona ls to s c hedule their time. The compa ny ’s one-s tep sc heduling a llows s c heduling meetings with la rge groups or individua ls ac ros s time zones , c alenda ring s ys tems , and companies. It allows us ers to schedule meetings a nd share thei r a va ila bility with others , a s well as connec t direc tly with calenda rs , inc luding O utlook a nd G oogle Figure 24. Company Descriptions Source. Company reports, Capital IQ, Crunchbase
  • 21. Page 21 RELEVANT DISCLOSURES APPLICABLE TO: NONE LIST OF DISCLOSURE TERMS: 1. None applicable. ANALYST CERTIFICATION Each analyst of Research Capital Corporation whose name appears in this report hereby certifies that (i) the recommendations and opinions expressed in this research report accurately reflect the analyst’s personal views and (ii) no part of the research analyst’s compensation was or will be directly or indirectly related to the specific conclusions or recommendations expressed in this research report. I n f o r ma t i o n a b o u t Re s e a r ch C a p i t a l C o r p o r a t i o n ’ s Ra t i n g S y s t e m, t h e d i s t r i b u t i o n o f o u r r e s e a r ch t o cl i e n t s a n d t h e p e r ce n t a g e o f r e c o m me n d a t i o n s wh i c h a r e i n e a c h o f o u r r a t i n g c a t e g o r i e s i s a v a i l a b l e o n o u r we b si t e a t ww w. r e s e a r ch c a p i t a l . c o m. T h e i n f o r ma t i o n c o n t a i n e d i n t h i s r e p o r t h a s b e e n d r a wn f r o m s o u r c e s b e l i e ve d t o b e r e l i a b l e b u t i t s a c cu r a c y o r co mp l e t e n e ss i s n o t g u a r a n t e e d , n o r i n p r o vi d i n g i t d o e s R e s e a r c h Ca p i t a l C o r p o r a t i o n a s s u me a n y r e sp o n si b i l i t y o r l i a b i l i t y . R e s e a r ch C a p i t a l C o r p o r a t i o n , i t s d i r e ct o r s , o f f i c e r s a n d o t h e r e mp l o y e e s ma y , f r o m t i me t o t i me , h a v e p o si t i o n s i n t h e s e cu r i t i e s me n t i o n e d h e r e i n . Co n t e n t s o f t h i s r e p o r t c a n n o t b e r e p r o d u c e d i n wh o l e o r i n p a r t wi t h o u t t h e e xp r e ss e d p e r mi s si o n o f R e se a r ch C a p i t a l C o r p o r a t i o n . ( U . S . I n s t i t u t i o n a l Cl i e n t s — Re s e a r ch C a p i t a l U . S. A . I n c. ( a wh o l l y o wn e d s u b si d i a r y o f R e s e a r c h C a p i t a l Co r p o r a t i o n ) a cc e p t s r e s p o n si b i l i t y f o r t h e c o n t e n t s o f t h i s r e p o r t s u b je c t t o t h e t e r ms & l i mi t a t i o n s s e t o u t a b o v e . F i r ms o r i n s t i t u t i o n s r e ce i vi n g t h i s r e p o r t s h o u l d e f f e ct t r a n s a ct i o n s i n s e c u r i t i e s d i sc u s se d i n t h e r e p o r t t h r o u g h R e s e a r ch C a p i t a l U . S . A . I n c. , a B r o k e r - D e a l e r R e g i s t e r e d wi t h t h e U n i t e d S t a t e s S e cu r i t i e s a n d E xc h a n g e C o m mi s si o n ) . Tor on to 4 16. 8 60. 76 00 M ontr eal 51 4. 39 9. 150 0 V anco u ver 60 4. 66 2. 180 0 C al gar y 40 3. 26 5. 740 0 R egi na 306. 566. 7550 www.researchcapital.com